IRAs are a fabulous way to save money. While there is a ton of information available about investing in IRAs, there are three myths that I hear from mothers over and over again. These myths have stopped many mothers from investing in IRAs, so please read on!
Stay at home spouses are ineligible to contribute to an IRA. False! If you file joint tax returns, the spouse who stays home is eligible to contribute to an IRA based on the working spouses income. The same rules that apply to the spouse who earns the income are applied to the spouse who stays home, and the contribution is fully tax deductible until your joint Adjusted Gross Income is $150,000 or higher.
Minors may not open an IRA. False again! The only thing that is required for a minor to open an IRA is taxable income. Many parents pay their children to help in the family business, even if its just sweeping the floors and taking out the trash, or children may have other outside income from working somewhere.
You must contribute to an IRA before December 31st Guess what? Wrong again! You can contribute to an IRA up to the date you file your taxes. So this year you have until April 15, 2005 to contribute to an IRA. This means you can take your spouses end of year bonus and invest it in your IRA when all the financial institutions reopen on January 2nd!
So now that you know the real deal about investing in an IRA, do yourself a favor and open one today!
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