Local Basking Ridge Advisor Provides Insight on the Importance of this Retirement Account
December 11, 2014 – January 1, 2015 marks the 40th anniversary of Individual Retirement Accounts (IRAs) in the United States. Born from the passing of the Employee Retirement Income Security Act (ERISA) of 1974, IRAs were created to protect workers’ earned company retirement benefits and transfer them to their own retirement accounts, thus the name Individual Retirement Accounts. IRAs also provided an alternative for Americans to save on their own rather than depending entirely on company pensions to fund their retirements. With fewer lifetime employees and increasing mismanagement or underfunding of pension plans, IRAs shifted the financial responsibility and the risk from the employer to the employed. IRAs have proven to serve as a vehicle to give Americans more control over their retirement savings and have become the ultimate retirement savings vehicle as many retirement contribution plan funds end up in IRAs as rollovers from 401(k), 403(b) and other company plans.
“IRAs have become an integral part of retirement planning,” says Walter Pardo, Managing Partner of WFP Tax Partners, LLC, in Basking Ridge, a member of Ed Slott’s Master Elite IRA Advisor Group with Ed Slott and Company, “America’s IRA Experts.” “With employer benefit plans, such as pensions, becoming increasingly unreliable, coupled with increasing life expectancies and rising cost of living, IRAs have become a crucial component to help millions of Americans save on their own terms to fund their retirement years.”
In the beginning, IRAs allowed savers to contribute up to $1,500 a year. In 1981, the Economic Recovery Tax Act opened up IRAs to any taxpayer under the age of 70 ½ and increased the maximum yearly contribution to $500. Now, according to the Government Accountability Office, 43 million taxpayers have an IRA with a total reported value of more than $5 trillion. The maximum contribution amount for 2015 is $5,500 and $6,500 for account holders age 50 or over.
“IRAs have changed the landscape for retirement savers and retirees alike,” says Ed Slott, the nation’s leading authority on IRAs. “But, as with most laws, there are many intricacies that come with IRAs that only a few financial advisors truly understand. The Elite IRA Advisor Group members not only know how to properly get money into IRAs, but they also know how to get it out without losing an excessive amount in unnecessary taxes, penalties or fees.”
As part of Walter’s commitment to expanding and maintaining his IRA knowledge, Walt is a member of Ed Slott’s Elite IRA Group, where he receives personal training and ongoing updates from “America’s IRA Experts.” As news breaks and tax rules continually change, the members of this group are informed with extensive specialized knowledge, tools and resources to help their clients handle their IRAs as tax-efficiently as possible before, during and after retirement.
As a part of the IRA’s 40th anniversary, Walter welcomes requests for information about how the IRA has changed, common misconceptions about the account, frequently asked questions and the most overlooked planning errors when it comes to IRAs. For more information contact Advisor by calling
About Ed Slott and Company
Ed Slott and Company, LLC, provides timely and accurate IRA education to hundreds of thousands of financial advisors and consumers throughout the year. They are on a mission to match consumers with competent, educated financial advisors. Known as “America’s IRA Experts,” Ed Slott and Company offers various training programs and educational products. Ed Slott and Company has further promoted their mission through national public television specials aimed to teach consumers how to ask the right questions to get the most out of their retirement savings. The public television specials, including Ed Slott’s Retirement Rescue!, have been viewed by millions of Americans and have raised millions of dollars in donations for public television. For more information about Ed Slott and Company visit www.irahelp.com.