Category: Retirement & Social Security

Single and head-of-household filers earning above $153,000 in modified adjusted gross income will begin losing eligibility to contribute directly to a Roth IRA for the 2026 tax year, with the door shutting entirely at $168,000. Joint filers face a narrower squeeze between $242,000 and $252,000. Those thresholds, set through the IRS’s annual inflation adjustment process,…

Anyone who inherits an IRA from a person who died after Dec. 31, 2019, now faces a hard deadline: the entire account must be emptied by the end of the tenth year following the year of death. Miss that window and the remaining balance gets hit with steep tax penalties. The rule, written into federal…

Anyone with a Roth IRA can pull out the money they personally contributed at any age, for any reason, without owing federal income tax or an early withdrawal penalty. That single rule, rooted in the ordering framework of 26 U.S. Code Section 408A and its companion regulation, separates the Roth from nearly every other retirement…

Families sitting on unused 529 college savings now have a direct path to convert those dollars into retirement wealth. Section 126 of the SECURE 2.0 Act of 2022 allows a 529 beneficiary to roll over surplus funds into a Roth IRA, tax-free, up to a $35,000 lifetime cap. The rule applies to distributions made after…

Workers who have turned 50 can steer up to $31,000 into a 401(k) during the 2025 tax year, combining the standard $23,500 employee contribution cap with a $7,500 catch-up allowance. The IRS set these figures as part of its annual cost-of-living adjustments, raising the base elective deferral limit by $500 over the 2024 ceiling of…

Workers across the United States directed a record share of their paychecks into 401(k) plans last quarter, yet the average account balance still fell by 4 percent. The disconnect between rising contributions and shrinking balances traces back to equity-market losses that erased gains faster than new savings could replace them. For the tens of millions…

Workers who separate from a job at age 55 or older hold a tax advantage that most people overlook and that some employer plans effectively strip away. Under federal tax law, distributions from a 401(k) taken after leaving an employer in or after the year a worker turns 55 can escape the 10% early-withdrawal penalty…

Anyone who converts money from a traditional IRA to a Roth IRA before the end of 2025 will trigger a separate five-year waiting period on that specific batch of dollars. Convert again in 2026, and a second clock starts. Each conversion carries its own countdown before the converted amount can be withdrawn free of the…

Roughly 37 percent of American adults cannot cover a $400 emergency expense using only cash or its equivalent, according to the Federal Reserve’s latest household survey. That financial fragility is colliding with new federal rules that make it easier than ever for workers to pull money from retirement accounts before age 59 and a half,…