The 4 Levels Of Investment Planning

401(k)
Traditional IRA / Participant IRA
Rollover IRA

(Recommended Level = Maximum Allowable)

Features And Benefits

• Pre-tax / Tax deductible contributions.*
• $6,000 annual limit into an IRA ($7,000 at age 50+)
• Principal and earnings grow tax-deferred until withdrawn.
• 10% IRS penalty for early withdrawal prior to 59 1/2
• Fully taxable upon distribution

*Modified AGI limit may apply.

Roth IRA, Variable Annuities
Cash Value Life Insurance
529 Educational Savings Plans

(Recommended Level = Maximum Allowable For Goal & Objective)

Features And Benefits

• Contributions are not tax-deductible.
• Principal and earnings can grow tax-free/deferred until withdrawn.*
• $6,000 annual limit into a Roth IRA ($7,000 at age 50+)
• Unlimited contributions into non-qualified Variable Annuity.
• $16,000 annual gift exclusion per donor per beneficiary into 529 Plans.
• 10% IRS penalty for early withdrawal prior to 59 1/2 (earnings only).
  (Earnings are taxable upon distribution except for qualified Roth IRA and 529 distributions.)

*A Roth IRA offers tax free withdrawals on taxable contributions. To qualify for the tax-free and penalty-free withdrawal or earnings, a Roth IRA must be in place for at least five tax years, and the distribution must take place after age 59 ½ or due to death, disability, or a first time home purchase (up to a $10,000 lifetime maximum). Depending on state law, Roth IRA distributions may be subject to state taxes.

Equity (Stock) Mutual Funds
Stocks, UIT's, ETP's, MLP's
Fixed Income (Bond) Mutual Funds
Corporate, Government and Municipal Bonds

(Recommended Level = $25,000+)

Features And Benefits

• Contributions are not tax-deductible.
• Unlimited contributions.
• Taxable dividend and capital gain income annually.
• No IRS penalty for early withdrawal.
• Earnings are taxable upon distribution
• Interest and dividends are taxable when credited.

Checking, Savings, Money Markets, Certificates of Deposit

(Recommended Level = 3 to 6 Months of Bills)

Features And Benefits

• Contributions are not tax-deductible.
• Unlimited contributions.
• No IRS penalty for withdrawal.
• Interest is taxable when credited.