Tax day has come and passed. Did you get a refund? If so, what is your plan?
There are a number of things you can do with your recent inflow--home remodeling, take a trip or finally pull the trigger on a large purchase. Each of those options would be rewarding but they probably aren't going to improve your chances at a financially secure retirement. Consider saving your refund.
There are a number of ways that you can save your refund. First: you can put the money into a savings account or a taxable investment account. This method can prevent you from spending it too quickly. Second: contribute the money to a Traditional IRA. Depending on your earned income and participation in an employer's retirement plan, this contribution may be tax deductible to you. The final option I will present is making a contribution to a Roth IRA. Although, this contribution is not eligible for a tax deduction, it will provide you with tax free growth if withdrawals are made in retirement and the account has been open for at least 5 years. In order to be eligible for a Roth IRA contribution your annual income must be below the maximum allowable level. Please consult your tax professional to determine your eligibility to make a contribution to a Traditional or a Roth IRA.
I'm sure it can be very difficult putting off that vacation you had your sights set on, but by saving and investing your money into your future--you give yourself the potential to enjoy multiple vacations in retirement as opposed to just one now.
Ethan Wade, Financial Advisor
(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author's opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).