Whether you’ve been laid off or quit, you have choices to make about your savings. Many folks aren’t aware of their options so they do nothing, but this could have financial consequences.
401k or IRA funds are what we call “tax-deferred”, not “tax-free”. IRS tax laws require funds invested in tax-deferred plans must start to be distributed by age 72, and taxable at your current tax rate when taken.
The “Backdoor Roth IRA Contribution” is a workaround that enables “high-income” savers to sidestep the income restrictions and reduce taxable income. So how does it work? Let me share the details with you.