With the 2026 tax season just weeks away, officials are releasing new information about the Trump administration's much-discussed "Trump accounts." Treasury Secretary Scott Bessent unveiled additional details about the new Trump accounts during a Dec. 17 press conference, clarifying how they can be opened, managed and eventually used by children as they reach adulthood. How to open a Trump account Trump accounts can be established either when filing taxes with the new Form 4547 or through the dedicated ...

Core Insights - Building a solid nest egg is crucial for financial stability in retirement, as Social Security provides an average of $2,000 per month, which may not be sufficient for many retirees [1] Retirement Account Options - Roth IRAs are popular due to tax-free investment gains and withdrawals, and they do not require minimum distributions, unlike traditional IRAs and 401(k)s [2] - However, a Roth IRA may not be suitable for everyone, particularly in certain financial situations [2] Scenarios to Consider Skipping Roth IRA - If income is rising in 2026, individuals may enter a higher tax bracket, making traditional retirement accounts more beneficial due to the tax break on contributions [3] - Those expecting significant gains in a taxable brokerage account may also benefit from the tax break on contributions offered by traditional accounts [4] - Nearing retirement age with most savings in a Roth account may necessitate contributions to a traditional IRA or 401(k) to ensure some taxable income in retirement [5] - Having taxable income can provide opportunities to claim tax credits and deductions, which may be lost without it [6] - Concerns about premature withdrawals from a Roth IRA may lead individuals to consider traditional accounts instead [7] - Charitable donations may also be impacted by the lack of taxable income, limiting potential deductions [8]

Key Takeaways The end of the year is near and you might be busy stocking up on gifts and planning visits to family and friends. But retirees should keep another year-end deadline in mind: taking required minimum distributions, or RMDs. New research from Vanguard estimates that missed RMDs could cost retirees up to $1.7 billion annually. Starting at age 73, investors must take RMDs, which are required annual withdrawals from accounts like 401(k)s and traditional IRAs. (Though if you're still working and have ...

Core Insights - The article emphasizes the importance of a Roth-first strategy for retirement planning, particularly in light of upcoming tax changes in 2026 [2][3][4] Group 1: Roth Accounts Strategy - The recommended approach is to maximize contributions to Roth accounts while tax rates are still low, prioritizing Roth IRA and Roth 401(k) contributions over traditional accounts [3][5] - Converting funds from traditional IRAs to Roth IRAs before tax rates increase can lead to significant tax savings in the long run [4][5] Group 2: Timing and Tax Implications - The expiration of the Tax Cuts and Jobs Act provisions after 2025 will likely result in higher federal tax rates for many Americans starting in 2026 [4] - By converting to Roth accounts before the tax rate increase, individuals can lock in lower tax rates and benefit from tax-free growth [5][7] Group 3: Implementation Steps - The Roth-first strategy involves three key actions: contributing to Roth accounts, converting traditional IRA funds to Roth, and maximizing contributions to Roth options in 401(k) plans [6][7][8] - For 2025, the contribution limits for 401(k) plans are set at $23,000 for individuals under 50 and $30,500 for those aged 50 and older [8]

Alice is a relatively young retiree and likely has many independent years ahead of her. But it’s helpful to consider that at some point, she may need to outsource some daily living tasks. In fact, according to the Center for Retirement Research (CRR) at Boston College, 80% of 65-year-olds will need long-term care at some point over their remaining years (1).Some retirees simply need an extra hand with groceries or household chores. Others may require long-term care with daily support for everyday tasks. And ...

Core Insights - As the new year approaches, individuals are encouraged to set financial goals, particularly focusing on enhancing retirement savings through appropriate account choices [1]. Group 1: Retirement Account Options - Many individuals appreciate the immediate tax benefits of traditional IRAs, while Roth IRAs offer tax-free growth and withdrawals in retirement [2][7]. - Choosing a Roth IRA may be advantageous for those in lower tax brackets, as they can benefit from tax-free withdrawals later when they may be in higher tax brackets [3][4]. - Concerns about future tax rate increases make Roth IRAs appealing, as they allow individuals to lock in their current tax rate, ensuring tax-free withdrawals regardless of future tax changes [5][6]. Group 2: Flexibility in Retirement Savings - Roth IRAs provide greater flexibility for future withdrawals, accommodating potential changes in financial needs post-retirement [8].

Key Points Roth IRAs can be wonderful tools when you're saving for retirement. They feature tax-free withdrawals. You might want to invest in some other accounts, too, in addition to a Roth IRA. These 10 stocks could mint the next wave of millionaires › Many people have long assumed that amassing a million-dollar portfolio is an out-of-reach, unrealistic goal. Well, it's not. Getting to a million does take some work -- and a lot of diligence -- but it's very possible for many of us. Here's a loo ...

Core Insights - The article discusses the growing popularity of Roth 401(k) plans and highlights the importance of considering them for retirement savings [2][3] Group 1: Roth 401(k) Plans - Roth 401(k) plans have become more popular, with 85% of employer-sponsored plans offering this option, yet only 18% of employees utilize it [2] - Unlike Roth IRAs, Roth 401(k) plans do not have income limits, making them accessible to high earners [4][5] - Contributions to Roth 401(k) plans are made with after-tax dollars, allowing for tax-free withdrawals in retirement if certain conditions are met [6][7] Group 2: Expert Opinions - Personal finance expert Suze Orman emphasizes the advantages of Roth 401(k) accounts, arguing that individuals should prioritize them regardless of their tax bracket [5] - Orman warns that traditional 401(k) plans, while providing upfront tax benefits, can lead to tax liabilities upon withdrawal in retirement [6]

SmartAsset and Yahoo Finance LLC may earn commission or revenue through links in the content below.A large, one-time conversion can create a significant upfront cost, which is why some investors choose to convert smaller portions over multiple years to manage the tax impact.When you convert pre-tax savings to a Roth IRA, the converted amount becomes taxable in the year of the transfer. This added income can increase your federal tax bill, move you into a higher tax bracket and affect other calculations tied ...

Missing this deadline could result in easily avoidable penalties.The end of the year usually brings many deadlines, especially those related to personal finances. One of the deadlines approaching is the required minimum distribution (RMD) that applies to people with tax-deferred retirement accounts like a 401(k) or traditional IRA.Beginning when you turn 73, RMDs are a way for the IRS to collect taxes on the back end after providing you with an upfront tax break that allowed you to lower your taxable income ...