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Understand the Impact of Taxes on Contractors

A contractor, or freelancer, can be anyone who works for clients on a contract basis rather than as an employee. Being a contractor can mean flexible hours, getting to choose your projects, and getting to work with multiple clients. But it can also mean a few extra headaches come tax season.

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Learn More About: IRAs and 401(k)s

Individual Retirement Accounts (IRAs) and 401(k)s are two popular types of retirement-savings accounts. People may open and fund the accounts with savings during their working years and withdraw money from the accounts in retirement to pay for living expenses.

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IRAs vs. 401(k)s: Explained

Individual Retirement Accounts (IRAs) and 401(k)s are two popular types of retirement-savings accounts. People may open and fund the accounts with savings during their working years and withdraw money from the accounts in retirement to pay for living expenses.

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Taxes for Contractors: Explained

A contractor, or freelancer, can be anyone who works for clients on a contract basis rather than as an employee. Being a contractor can mean flexible hours, getting to choose your projects, and getting to work with multiple clients. But it can also mean a few extra headaches come tax season.

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Back of the Napkin: Fiduciary Duty

A fiduciary duty is a responsibility to put someone else’s best interests before your own. Often, that means the person with the duty (the “fiduciary”) must make decisions that financially benefit the person to whom the duty is owed (the “principal”) rather than making decisions that financially benefit the fiduciary.

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What Independent Contractors Need to Know about Paying Taxes

Paying taxes can be an overwhelming process if you work for yourself. In addition to paying federal and state income taxes, independent contractors, the self-employed, freelancers, and anyone who receives a 1099 …

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Want a Special Tax Break?

The savers tax credit gives a special tax break to people saving for retirement. Few people take advantage of this tax break because they don’t know about it. See if you are qualified. If you are, it can reduce your tax bill…

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Payroll Deduction IRAs: Retirement Options for All Employers

One of the simplest retirement plan options – Payroll Deduction IRAs – give employers the ability to offer their employees an easy to understand, cost effective way to save for retirement …

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Traditional IRAs: Tax Benefits

A Traditional IRA is a retirement savings account that allows individuals to deposit pre-tax income into investments – such as mutual funds, stocks, bonds, or ETFs – and these deposits can grow tax-deferred …

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Roth IRA: Invest for a Tax Break

A Roth IRA is a retirement account created to encourage individuals to save by offering a tax benefit. The account holds investments selected by the individual– such as mutual funds, stocks, bonds and ETFs, selected by the account owner …

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401(k)s: Employer-Sponsored Plans

A 401(k) is a retirement savings plan offered by employers to their employees. The plan – also known as a qualified savings plan – gives employees the ability to contribute some of their earnings to a tax advantaged savings account …

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Financial Jargon

Financial Jargon

We understand financial jargon can be confusing. Don’t worry! We’ve gathered a glossary of frequently used terms to make your journey to retirement that much easier. # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Share # …

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Getting Close to Retirement? Things to Think About.

Getting close to retirement? Tips to help make sure you’re on track. Once you’ve built a retirement nest egg, you’ll need a strategy for use your savings in retirement. Here are some things to keep in mind. Choose investments that fit your stage of life As you move towards retirement and have less time to recover …

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What to do with Your 401k Plan if You’ve Lost Your Job.

It’s stressful to lose your job. It’s additionally stressful to have to decide what to do with your 401(k) during this time. Here’s a few options to help make this decision easier …

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Make Sure You Know What Fees You are Paying

High fees can eat away your retirement savings, make sure you know what you’re paying. Many people don’t know how much they are paying for their retirement saving plan. Unfortunately, it’s all too common that people are paying high fees. Make sure you know what you’re paying, this will help make sure you’re on track …

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Financial Jargon

Understanding Mutual Funds

Although mutual funds seem complex, they’re simply professionally managed investment funds that combine money from investors to buy other securities. These can be stocks, bonds, and other assets.  Many retirement plans offer the option of investing in mutual funds. These are some familiar types of mutual funds. Balanced Funds These funds invest in both stocks …

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Five Ways to Reach Your Retirement Savings Goal

Successful investing will help you reach your retirement savings goals. To do this, you’ll need to assess your goals, review your options, and routinely check on your investments. The following tips will help you. Start today. The sooner you begin investing in your retirement plan, the more time you benefit from years of compounding growth. …

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Employer Match, a Great Benefit

Always take advantage of an employer-offered 401(k) match. It’s rare to receive free money, but that’s what a 401(k) match from an employer is. A “match” is when an employer contributes money to your 401(k) account when you put money into it from your paycheck. An employer’s match is a percentage of what you contribute …

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Emergency Savings, Everyone Needs them Sometimes

An emergency savings account is necessary for your financial well-being. Life’s unexpected surprises often have financial costs. However, with a little planning, an emergency fund can help you to successfully weather these small storms. An emergency plan will also help you to avoid using high-interest credit cards, personal loans, or prematurely withdrawing money from your …

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The Benefits of Saving Early

Start small, save early, and let the power of compounding work for you. Simply put, the earlier you begin saving, the better. Regardless of how much money you make, or how far away retirement may seem, it’s never too soon to start saving in a retirement plan. Waiting even a few months, could mean less …

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SEP-IRAs: Retirement Saving for Self-Employed Individuals

You’ve heard about Individual Retirement Arrangements (IRAs) as a good way to save when you don’t have access to a 401(k)-type plan. But if you’re self-employed, there’s an even better option — a simplified employee pension, or SEP-IRA. A SEP-IRA has much higher contribution limits than regular IRAs. Plus, they are easy to set up. Any size business can open a SEP-IRA. Only the employer can make contributions on behalf of employees. So, if you’re self-employed and you’re the only employee of your business, you’ll make contributions to the plan on your own behalf… You’ve heard about Individual Retirement Arrangements (IRAs) as a good way to save when you don’t have access to a 401(k)-type plan. But if you’re self-employed, there’s an even better option — a simplified employee pension, or SEP-IRA. A SEP-IRA has much higher contribution limits than regular IRAs. Plus, they are easy to set up. Any size business can open a SEP-IRA. Only the employer can make contributions on behalf of employees. So, if you’re self-employed and you’re the only employee of your business, you’ll make contributions to the plan on your own behalf. Here’s what you need to know about SEP-IRAs. SEP-IRA Basics Here are the basics of SEP-IRAs for the selfemployed: » You can open one with your bank or other financial institution. The person you work with will help you fill out a form for an IRS-approved “prototype SEP plan” or will help you complete IRS Form 5305- SEP. You don’t have to file the form with the IRS. It simply documents that you established the plan. » SEP-IRAs follow Traditional IRA rules on how they are taxed. Your contributions are tax-deferred until you withdraw them in retirement. » You can contribute up to 25 percent of your net earnings or $53,000 for tax year 2015, whichever is less. » You can choose among investment options. Typically, banks offer certificates of deposit (CDs) or money market funds. Other institutions, such as brokerages, life insurance companies and credit unions, offer stocks, bonds, mutual funds and other options. » You can roll your SEP-IRA into another SEP-IRA or Traditional IRA. If you take a job that includes a 401(k)-type plan, you can roll your SEP-IRA into the plan, as long as it accepts rollovers. » If you hold on to your business and take a second job that offers a 401(k)-type plan, you can participate in both. » You can’t take a loan from your SEPIRA. If you need access to the money before you reach age 59½, you can take a withdrawal, but you’ll typically pay ordinary income tax and a 10 percent penalty. » You can avoid the 10 percent penalty on your early withdrawal if it’s for certain reasons. These include: » College expenses » First-time home purchase (up to $10,000) »Certain medical expenses » Total and permanent disability » If you’re a reservist called to active duty » You inherit an IRA » You are receiving distribution in the form of an annuity » You’ll need to start taking distributions when you reach age 70½. The financial institution that holds your account will notify you when you need to start making withdrawals. Take Action! Q Make a plan for your retirement. Be specific and set realistic goals to help make retirement attainable. Q If you’re self-employed, consider a SEPIRA for your retirement savings, rather than a Traditional or Roth IRA. You’ll benefit from higher contribution limits. Q You can open one through a bank or other financial institution. Q Understand the investment options available and decide if they are right for you before opening your account. Q Since SEP-IRAs follow the rules for Traditional IRAs, see our related article on IRAs. Q Learn more about SEP-IRAs by reading “SEP Plan FAQs” on the IRS website.

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Saving for Retirement Through IRAs

Millions of working Americans have access
to work-based retirement savings plans,
such as a 401(k). But more than 70 million workers do not, in which case, an Individual Retirement Arrangement, or IRA, is a great way to save for retirement.Here’s what you need to know about IRAs…

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Retirement Planning Basics

Plan Your Road to Retirement

When you want to buy a house or a car or even go on a special vacation, you probably can actually “see” the goal you have in
mind, and that helps you plan and save enough to achieve the goal.
The same should be true for your retirement.If you can’t visualize where you’re heading…

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