An IRA can be a powerful way to save for retirement.
No matter what the market is doing, your IRA can still be a good way to save for tomorrow. For tax year 2014, you can contribute up to $5,500 to your IRA, and up to $6,500 if you were 50 or over as of December 31, 2014. Maximizing your contributions and starting early could help you save thousands more for your retirement.
Nonworking spouses can contribute, too.
Even if your spouse has little or no earned income, he or she may still be able to contribute to a spousal IRA—either a Traditional or a Roth IRA. To contribute, you must file a joint federal income tax return and have taxable compensation equal to or greater than the total amount contributed by both spouses. As with other IRAs, spousal IRAs offer benefits, including the higher contribution limits, deductible contributions to Traditional IRAs for qualified investors, the potential for tax-deferred growth, and federal tax-free withdrawals from Roth IRAs (provided the criteria are met).
Commit to regular investing.
Automatic investing directs money from your bank account into your IRA on a monthly or quarterly basis. You can easily add or update your automatic investing contribution instructions by calling 800-343-3589.
Important withholding information concerning retirement account distributions
Federal tax withholding
IRS regulations require us to withhold federal income tax at a rate of 10% from your total IRA distribution (excluding Roth IRA distributions). You may elect not to have federal withholding apply (provided you have supplied Fidelity with a U.S. address), or you may elect to increase the rate of withholding. Federal income tax will not be withheld from distributions from a Roth IRA unless you elect to have such tax withheld or are otherwise subject to withholding because you are a nonresident alien. Your election will remain in effect on checkwriting or periodic distributions taken under a systematic withdrawal plan from your IRA until revoked by you. You can change this election for future distributions at any time by sending Fidelity a written request or calling a retirement representative at 800-544-4774.
State tax withholding
If federal income tax is withheld from your distribution, state income taxes may also be withheld. Your state of residence will determine your state income tax withholding requirements, if any. Please refer to the list below. Your state of residence is determined by your legal address of record provided for your IRA. The information provided is general in nature and should not be considered legal or tax advice. Please contact your investment representative, tax advisor, or state taxing authority for assistance.
For residents of AR, IA, KS, MA, ME, OK, and VT: If federal income tax is withheld, state income tax of at least your state's minimum requirements must be withheld in addition to federal income tax withholding at the time of your distribution. If you elect out of federal income tax withholding, state income tax will not be withheld unless you indicate otherwise.
For residents of CA, NC, and OR: If federal income tax is withheld, state income tax of at least your state's minimum requirements must be withheld in addition to federal income tax withholding at the time of your distribution unless you elect not to have state income taxes withheld.
For residents of DC: If you take a distribution of your entire account balance and do not directly roll that amount over to another eligible retirement account, the District of Columbia requires that a minimum amount be withheld from the taxable portion of the distribution, whether or not federal income tax is withheld.
For residents of DE: State income tax of at least your state's minimum requirements must be withheld regardless of whether or not federal income tax is withheld unless you elect not to have state income taxes withheld.
For residents of MI: State income tax applies regardless of whether or not federal income tax withholding is applied to your distribution. Tax withholding is not required if you meet certain Michigan requirements governing pension and retirement benefits. Please reference the MI W-4P Form for additional information about calculating the amount to withhold from your distributions.
For residents of AK, FL, HI, MS, NH, NV, SD, TN, TX, WA, and WY: State income tax withholding is not available on your IRA distributions.
For residents of all other states and residents of DC taking periodic distributions: You are not subject to mandatory state income tax withholding; however, you may elect voluntary state income tax withholding in a percentage. If you elect to have state income taxes withheld and your state provides a minimum amount or percentage of withholding, you must elect a percentage that is not less than your state's minimum withholding requirements. If the percentage you elect for withholding is less than your state's minimum withholding requirements, your state's minimum amount or percentage will be withheld. Contact a Fidelity representative at 800-343-3589 for more information, or contact your state taxing authority for assistance.
Armed forces tax benefits
If you are serving in, or serving in support of, the U.S. Armed Forces in a designated combat zone or hazardous duty area, you may be eligible for an extension of your IRA contribution deadlines. Visit the IRS online at irs.gov or telephone them at 800-829-1040 for more information.
Take control of your old 401(k) — we are here to help
We know what it takes to help get an old 401(k) to work toward your goals. As the #1 IRA provider,1 we can help you put together a plan so your old 401(k) is working as hard as it can for you. Put our experience to work for you.
Guidance based on your needs
We’ll review your situation and help you create a plan for your retirement savings. Call 800-343-3589 to schedule a free portfolio review.
A wide range of choices
Expand your investing options with a Fidelity Rollover IRA. We offer access to a wide range of products and services to help meet your different investment needs including:
- One-on-one guidance2
- Investments ranging from over 5,000 mutual funds from Fidelity and other companies, stocks, bonds, FIDC-insured CDs3, ETFs, and annuities
- Great value in Fidelity IRAs with no account opening or annual maintenance fees* and online U.S. equity trades as low as $7.95 per trade all the time4
- Asset protection through certain Fidelity IRAs that offer an interest bearing cash position, offering the benefit of FDIC insurance eligibility through a Program Bank5
Free help choosing investments
We can help you make choices that can get you on the path toward your retirement goals. Consolidating your assets into a Fidelity Rollover IRA may make it easier to track investment performance, diversify your total portfolio, and maintain your asset allocation strategy.
Whether you’re just getting started, already retired, or somewhere in between, Fidelity is here to help. Our rollover specialists can get you started today and help you turn your old 401(k) into one, easy-to-manage Fidelity Rollover IRA. Call 800-343- 3589 or visit any one of our local Investor Centers.
Planning beyond retirement
Fidelity can not only help you with your retirement goals, but also help you plan for the transition into retirement and the years you'll spend living in retirement. We can help with creating your retirement income plan and discuss factors and considerations for creating your strategy for income during retirement. Learn about "What to do when..." based on where you are with your retirement planning goals.
Ensure your heirs inherit your IRA by keeping your beneficiaries up to date
Have you checked your beneficiary designation for your IRA recently? The IRA Beneficiary Summary section, part of your Form 5498 IRA Contribution Information Statement, provides a detailed list of the beneficiaries on file for your Fidelity IRA as of December 31, 2014.
You should review your beneficiary designations based on any important change in your family or financial status, such as a birth, death, marriage, divorce, or inheritance.
IRA assets generally pass to beneficiaries outside the instructions of a will. Your designated beneficiaries will receive your IRA assets after your death, so it is important to keep your beneficiary information up to date, or your heirs may be subject to a less favorable tax-treatment.
You can update your beneficiary information