The taxes on any appreciation are always deferred, regardless of whether you can deduct the initial contribution. While a Roth IRA cannot help reduce your current-year tax burden, it does allow the investment to grow potentially income tax free. To get the greatest benefit, contribute the maximum amount that the plan allows. Employers may also gain tax benefits for the current year by establishing a qualified retirement plan before Dec. 31, 1999. Contributons can be made until the tax-filing deadline.
Life insurance can provide policyholders with the opportunity for long-term cash accumulation.
While the earnings from these policies are tax-deferred, you should keep in mind that if you surrender a policy in its early years, fees and expenses can reduce the value of your investment. having annuity contracts in your portfolio can also provide valuable tac protection. Fixed annuities offer the ability to select from several guaranteed interest rate periods. While your money accumulates, the insurance company issuing your contract guarantees the interest and your principal against loss. Variable annuities provide investment flexibility and the ability to participate in market returns. They offer fixed-rate subaccounts as well as subaccounts tied to stocks and bonds, both domestic and global.