My 401(k) plan at work has been terminated. I will be doing a rollover to an Individual Retirement Account (IRA) in the amount of about $100,000. In the past, I contributed $400 per month. How can I continue to save this when the 401(k) plan is no longer offered through work? When I had my taxes done each year, my income was $35,000. I was only taxed on about $30,000 because of my 401(k) contribution. Therefore, I am looking for an avenue to save that would give me the same benefit.
"Given your income level, you can contribute up to $5,000 per year ($6,000 if you are 50 or older) to an IRA account," said FPA member Elaine Stansfield, CFP®, of Waddell & Reed. "With your current income level, this is deductible on your tax return (as the 401(k) contributions were), provided that you are not contributing to any other employer sponsored plans."