Investing Information

Now is the Time to Invest for Your Retirement!

Yes, it's the time we've all been waiting for?tax season! We know you've gotten a jump start and filed early this year, right? Of course not, but rather than dreading this part of the year, we should all look to it as a point for new opportunities. Many readers don't realize that even though the New Year has come, they can invest money as if it were still 2004! That's correct, it's not too late. You can invest funds into your retirement account until April 15th, 2005 and have it count as if the contribution were made in 2004! Investors typically choose to take advantage of this through an Individual Retirement Account.

Individual Retirement Accounts (IRAs) are excellent plans to build retirement savings. Depending on the type of IRA that you choose, contributions can be tax deductible and grow tax deferred or even tax free. There are three types of retirement accounts that are commonly used to accomplish your retirement goals; the Traditional IRA, Roth IRA, and SEP-IRA. To make things even better, the IRS recently announced new maximums for qualified plans for contributions counting in 2005 as an added incentive to invest for your retirement.

The Traditional IRA- In 2004, the annual contribution limit was set at $3,000. However, this was raised to $4,000 for contributions that are counted in 2005. Contributions are fully tax deductible if you do not participate in an employer retirement plan. Single tax-payers who participate in an employer retirement plan must earn a gross income of no more than $50,000 to earn a full deduction. Investments grow tax deferred with earnings taxed only at withdrawal.

The Roth IRA- Annual contribution maximums are the same for both Traditional and Roth IRAs. Contributions to the Roth IRA are not tax deductible. However, contributions and earnings can be withdrawn free of tax and investors are not required to take minimum distributions after age 70 ˝ as they would be under a Traditional IRA. Single investors must earn no more than $95,000 annually to be eligible for a full contribution.

The SEP-IRA- This plan is available to self employed individuals who normally do not fall into the low income category. These self employed individuals can contribute 20% of net income or $42,000, whichever is less. Similar to the Traditional IRA, contributions are tax deferred. However, the SEP-IRA allows participants to invest larger quantities toward retirement.

There is no better time than the present to begin planning for a financial stable retirement. To learn more about these opportunities or to begin investing for your retirement, contact and be sure to visit

Scott Pearson is an investment advisor, writer, editor, instructor, and business leader. As President and Chief Investment Officer of Value View Financial Corp., he offers investment management services to a wide variety of clients. His own newsletter, Investor's Value View, is distributed worldwide and provides general money tips and investment advice to readers both internationally, and in the U.S.

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