If you’ve been saving for retirement in your companies 401k or retirement program you may have had the thought of starting your own personal retirement account to have more control over. As a result you may have considered a Roth IRA as a suitable way to save that money however their are some Roth qualifications and requirements you will have to follow in order open an account.
First, you will have to meed income limits. In order to open a Roth you will have to earn less than $176,000 adjusted gross income on your taxes or you won’t be able to apply for the special tax privileges. If you file jointly this also means your spouse will be unable to qualify as well, meaning you will have to find other ways to invest money for your retirement such as a 401k plan.
Next in order to open a Roth account you need to have a job. A job is used to verify that you have income and will be able to fund the account. Although their is one exception to this rule. If you are a stay at home mom or a nonworking spouse you will be able to open a Roth Account as long as the other spouse has a job and does not earn more than the income limits. This rule is known as the spousal IRA provision.
Finally, the last rule to qualify for a Roth is the contribution limit. This rule is not a rule specifically given to open a Roth account but rather is a rule set by most financial institutions. For example, when I set up my Roth IRA I had to either put a $1000 into the account upfront or I had to start a monthly bank transfer that would add up to a $1000 in the first year. Typically most account minimums will start around $1000 to open an account.
- If you regret converting your IRA to a Roth, you can undo it (usatoday.com)