Safe retirement investments only for you
Are you on the verge of retiring? Then you must start thinking about your post-retirement investments. You must look for safe investments that will give you a good annual return. It is not possible nowadays to get 5% to 7% ROI. But there are many safe places to invest.
To find out safe places you need to know the type of investments that provide the protection of principals- FDIC insured money market accounts, savings accounts, and short term CDs. You will get around annual yields of 1% or so if you look for the highest paying accounts.
You may go to those high-yield checking accounts, who make you jump through lots of hoops like doing a fixed number of transaction every month. Here you may look for a little more, like 1.5% return. Most of the times they limit the amount $25,000 or less, on which they will pay their highest rate.
You can go to a longer time CD. There you may get around 2% returning. But Financial Industry Regulatory Authority alerts advice to be very careful about the pitches for high yielding CDs. They can even drag you towards several other retirement investment plans.
All these accounts will help your money to grow fast but tax-free. You need to pay the tax only when you take out the money from your account and close it. Though this does not happen with Roth IRAs. Here no tax is due at the withdrawal of the money. If you take out the money before reaching the age of 59 and a half, mostly you will need to pay a 10% penalty added to the regular income tax.
The Internal Revenue Service has their own complicated rules and regulations for different types of retirement accounts. There are certain tax breaks which are only available to those people having a certain amount of income. So you need to check the IRS website very well for details or go to your account.
If you are doing a thorough retirement investment planning, then keep this information handy!