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When to Make Your Contributions
Taxpayers typically have until their taxes are due to fund a traditional
IRA or Roth
IRA for the previous tax year. For example, taxes are due on April 15, 2013
for income earned in 2012. You have until April 15, 2013 to fund your IRA and
claim a deduction against income earned in 2012.
However, the earliest you can fund an IRA for 2012 income is January 1, 2012.
That is fifteen and one-half months before the latest funding date of April 15, 2013.
If your IRA earned eight percent, funding it on January 1, 2012 instead of
April 15, 2013 could mean a significant difference in its value over time. For
example:
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IRA Contribution
January 1, 2012
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IRA Contribution
April 15, 2013
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| Amount you contribute |
$5,000
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$5,000
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| Balance on Dec. 31, 2013 |
$5,864
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$5,290
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| Difference |
+$864
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+$290
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The longer your money stays invested, the harder it can work for you. Fund your IRA at the earliest possible date and you could benefit.
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Next Steps
Choosing between a traditional or Roth IRA?
Questions? Investment Specialists are available 24 hours a day at 1-800-359-3379.
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Secure Account Access Login
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