Quick Post: Roth Options if Your Income is Too High

Click here to learn more on whether a Roth or Traditional retirement account is right for you.

In my first post on why you should save for retirement now, I had an awesome question from Flo, a close friend.  The question was concerning Roth IRA limitations.  Generally, if you make over a certain amount, you do not qualify to deposit money in a Roth IRA.  Here’s the limit for 2016 according to the IRS.


In any case, here are two potential ways to get around this restriction.

#1. Maximize your traditional IRA contributions, and then you can rollover your traditional IRA to a Roth IRA.  Be aware that you will have to pay taxes on this conversion, and you will have to fill out a Form 8606 according to the IRS.  You can read more specifically here (It’s long).  Generally, financial firms will make it easy for you to rollover / convert your traditional IRAs to a Roth IRAs, you just have to be aware of what your tax bill will be.

#2. There’s no income limitation to a Roth 401(k) according to the IRS, so if you have this option feel free to max this out!  Woot!

Again, please remember to visit our disclosures page if you haven’t already. 

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