IRA Rules

Posts Tagged ‘investing’

Question: Day trading in an IRA rules?

What would be considered day trading in an IRA? Does it have to be the same stock traded, bought and sold in the same day? I do trade in my IRA, I will hold a stock for at least 2 days before selling. If I bought APPL, CIT, and BAC on one day, held them for 2 days or more, then sold one or two and bought BA, CAT, LVLT. Would that be considered day trading? Would trading back and forth between stocks within a week be allowed within an IRA?

Answer: The SEC’s definition of a day trader is someone who makes 3 or more intraday trades in a five business day period. So if you bought some stock and sold them the next day that wouldn’t count. If you wish to make more than 3 intraday trades a week you will have to maintain a 25k balance in your account or the SEC will freeze your account.

Question: Roth IRA – Home Buyer?

Say, I invested $20000 into Roth IRA. Then the following year I have $21000 in the account and I am purchasing a my first home on that same year.

So I proceed to take $21000 out and I understand the 5-year rule is not met.
However, since I am purchasing a new home, should it be considered a “qualified distribution” and will not subject to taxation & penalty?

Please elaborate your answer, thank you!

Answer: There is a little known tax rule:
You can take out money out of a ROTH within the first 5 years without the 10% penalty
IF you use it for the purchase of your first home.

Talk to your broker or account manager.
See if you can re-characterize and put that money back in your ROTH.
Then, you will need a special tax form to take the money out of your roth for your first home purchase.
Please talk to your advisor – and fix this mess.

Google: Taking money out of a roth without penalty

http://www.fool.com/money/allaboutiras/allaboutiras12.htm

Motley fool – funny name for a financial site – very good site to read.
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Roth IRA Conversions – The 5-Year Rule

Question: Bad idea to save 10% of your income for retirement?

I am low middle class income and I have to tighten my belt quite a lot to save 10% of my income for retirement. Most americans only save 1% for income. When I retire, I may have a lot of money, but apparently most americans will not. Which means I may be taxed heavily to pay for thier welfare and special programs. I know my Roth IRA is not supposed to be taxed again…BUT they have 30 years to change the rules and it could get taxed! Is there a way to ensure to my nest egg pays out to only myself when I am retired? Thanks!

Answer: You are on the right track. you are responsible for your own life. do not look back at the people around you. you have to take care of your self first before others. In the mean time, Learn how to invest properly. I also set aside 15% of my pay to my 401 k too. I used to live in communist government, I had to take care of myself first.I think the social security system is a scam, out of date, need to change. Since FDR, 36 people support 1 person, now is 4 support 1, baby boomer retired pretty soon, 2 will support 4

Yes you could learn invest by yourself. it is your money, you should know how to do with it. for starter check this site out.

http://www.pathtoinvesting.org/index_fla…

http://www.stockcharts.com

http://www.streettalklive.com>… university. a lot amount of information. It will serve you well
I accumulate in good amount in 401k at the young age.I could share with you. when consider invest in stock market. you should consider basic 3 things:

fundamental analysis==(economic data,finincial health, management, business model, competetion)>>what to buy

technical analysis==(chart+indicator)>> when to buy

Sentiment/schycho analysis==>>mood of investor, Contrarian point of view.
Market cycle===>> check out book Trader Almanac by jeff hirsch will give you inside stuff
When you combine 3 thing, It is one of the powerful knowledge goinh with you for the rest of your live

At the age of 32. my 401k is amassed 73,000.00 and 30000.00 in taxble account. by follow simple rule

Self Directed IRA and 401K:Tax Liens and deeds build IRA’s 401K