Catch Up on IRA Investing
January 5th, 2011 Filed under: ira investing — Investing Author
As per the guidelines set forth by the US Government, a catch IRA is allowed for the US citizens above 50 years of age. This program allows the people to make contributions up to $5000 in one year towards their retirement with additional contribution of $1000 for Roth IRA and the traditional IRA.
The total allowable contributions which have been set by the government have been consistently increasing since its inception. The amount under future of limits has still not been set but it is commonly believed that this limit would go on increasing year after year.
There are few extra requirements apart from person’s age which may make him eligible for this investment of increased amount. For Roth IRA and the traditional 401k, yearly income of a person should be less than $105,000 and this amount is $166,000 for the married person for year 2009.
The maximum allowed contribution for employee pension IRA limits for 2009 has been capped at 25 % of his salary. Standard limit of $11500 has been kept for the standard IRA with $14,000 as catch up limit for year 2009. Employees who have been sponsored for Solo K and 401 K have $16500 limits with $22000 as a catch up limit.
The amount of money which can be contributed by a person depends upon the retirement fund he is enrolled to. Each of these schemes has his own benefits and requirements. It is up to a person to select an appropriate plan and the amount of investment.
In order to provide additional information, IRS has come out with publication 590, Individual Retirement Arrangements which can guide the investors. Catch up IRA may be available to you irrespective of the program you are enrolled to; just you need to check if you qualify.
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