There is an old saying that is thought to be by Mark Twain that really makes you think. It says –“It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.” This quote relates well to retirement planning as there are many misconceptions in the retirement planning world which can cost you a lot of money.
One of the most common misconceptions is in regards to the IRA. The IRA is one of the most popular and utilized financial tools used in America. However, even with the popularity and common use of this tool, there are many misconceptions and misunderstandings about IRAs, such as:
An IRA is an investment – This is not true. An IRA is an account registration, not an investment.
There is only one type of IRA – There are many different types of IRAs.
You can only contribute to an IRA for yourself – In some circumstances, you can contribute for both you, a spouse and your children.
A rollover to an IRA is always in your best interest – An IRA rollover from a company sponsored retirement plan can be a good move in many circumstances, but not always.
These are just a few of the misconceptions about IRAs. For a complete list and thorough analysis on all of the IRA misconceptions, attend one of our upcoming classes in your local community.