If you have an Individual Retirement Account (IRA) to contribute to your retirement saving efforts, there are a few things you can do now to set yourself up for success in 2024 and beyond. In this guide, we'll explore key strategies to kickstart your IRA for the year ahead.
Maximize contributions
Take advantage of the annual contribution limits set by the IRS. As of 2024, individuals can contribute up to $7,000 to an IRA, with an additional $1,000 catch-up contribution allowed for those aged 50 and older. Maxing out your contributions ensures you're making the most of your tax-advantaged savings potential.
- Did you know you have until Tax Day (April 15th) to make a prior-year contribution to an IRA?
Consider your investment strategy
Evaluate your risk tolerance and investment goals when selecting assets for your IRA. A well-diversified portfolio can help mitigate risk and enhance long-term returns. Consider a mix of stocks, bonds, and other investment vehicles based on your time frame and risk appetite. Periodically review your IRA portfolio to ensure it aligns with your financial objectives.
Explore additional retirement savings options
While contributing to your IRA is a great step, explore other retirement savings avenues, such as employer-sponsored plans (e.g., 401(k)), especially if your employer offers a matching contribution. Taking advantage of these opportunities can significantly boost your overall retirement savings.
Stay informed
Tax laws and regulations can evolve, impacting your retirement savings strategy. Stay informed about any changes that might affect your IRA, such as modifications to contribution limits, income thresholds, or tax benefits. Consult with a financial advisor for personalized advice.
Plan for required minimum distributions (RMDs)
If you have a Traditional IRA, be aware of RMDs, which typically begin at age 72. Failure to withdraw the required amount may result in penalties. Plan ahead and consider the impact of RMDs on your overall retirement income strategy.
- The Secure Act 2.0 introduced several early withdrawal exceptions. Read our guide to see if your situation qualifies you for a penalty-free withdrawal.
As you set your financial goals for the year, optimizing your IRA should be a top priority. By understanding the basics, maximizing contributions, and implementing sound investment strategies, you can set yourself on a path towards a more secure and comfortable retirement. General Electric Credit Union offers both traditional and Roth IRAs in addition to IRA Money Market Accounts. Meet with a team member for help determining the right retirement savings option for you.
