- Tax Planning
- Investments 1: Before you Invest
- Investments 2: Your Investment Plan
- Investments 3: Securities Market Basics
- Investments 4: Bond Basics
- Investments 5: Stock Basics
- Investments 6: Mutual Fund Basics
- Investments 7: Building Your Portfolio
- Investments 8: Picking Financial Assets
- Investments 9: Portfolio Rebalancing and Reporting
- Retirement 1: Basics
- Retirement 2: Social Security
- Retirement 3: Employer Qualified Plans
- Retirement 4: Individual and Small Business Plans
- Estate Planning Basics
Case Study #1 Answers
Your assumptions should relate to three key areas:
1. Your projected tax rate in retirement: If you expect your tax rate to be higher than it is now, the Roth is preferred. If it will be lower than now, the traditional IRA would be preferred.
2. Your need for the tax break now: If the reduction in AGI is important to reduce taxes, then you would likely choose the traditional
3. Your cash flow situation: There are tax benefits to the traditional, but if you can go without those benefits, you are actually putting in more money into the Roth IRA (due to taxes).
