Retirement Planning: 2006 Roth IRA Contributions
My wife and I have been distracted lately with kitchen cabinets being installed. Corian kitchen and bathroom counter tops and hardwood floors being installed and sanded. However, we are aware that we have until April 17, 2007 to complete our Roth IRA contribution for fiscal year 2006. The contribution limit is $4,000 each and my wife has already contributed $2,000 directly to an international value mutual fund while I have contributed about $1,250 to a small cap growth mutual fund. So we have about $3,750 left to contribute to our Roth IRAs.
The plan is to wait until April until we do our contributions. We plan to do this for a couple reasons:
1) Our current available cash is being tied up in home improvement projects and
2) I want to wait and see what the stock market is going to do in the next couple months. There is still part of me that is very concerned about the stock market and I think any day it could begin a move downward. Obviously, I cannot time this if it does occur, but since our money is tied up I thought it was a wise retirement planning investment strategy.
The probable scenario for investment choices will be that my wife will deposit $2,000 into her Scottrade Roth IRA account when we have enough of a safety net in cash. Then that $2,000 will go toward an individual stock that looks undervalued at the moment. My $2,750 would be contributed directly to a couple mutual funds. One will be an international growth mutual fund and $1,750 will go into that asset class. The remaining $1,000 will go into a real estate mutual fund. I think both of these investments are solid no matter what happens in their own asset class and I see them doing well in the short-to-mid-term (I only invest in mutual funds that have excellent long-term track records–so the long-term performance is a give for me).
If we have enough cash in our savings we will begin our 2007 Roth IRA contributions, but we will cross that bridge when we get there.
Written by Nagel on February 21st, 2007 with no comments.
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