13 Steps to Investing Foolishly, Step 4: Open and Fund Your Accounts

Worldwide Invest Better Day 9/25/2012

In honor of Worldwide Invest Better Day, we at The Motley Fool are recapping our "13 Steps to Investing Foolishly" — steps you can follow to become a better, more Foolish investor.

In the following video, senior analyst and Foolish retirement pro Robert Brokamp goes through step No. 4: opening and funding your accounts. 

Robert's use of Procter & Gamble's Crest toothpaste brand to illustrate the variety of different accounts available to investors is no coincidence. This dividend aristocrat has been a long-time favorite holding for investors shoring up for the long run. Not only has the company raised its dividend for 56 years, but shares have also appreciated more than 13,000% (after reinvesting dividends) over that same period.

Want to know whether you’re eligible for all of the tax benefits of an IRA? Here’s what you need to know: Whether contributions to a traditional IRA are deductible starts with whether you (or your spouse, if you have one) are covered by a retirement plan at work. It doesn’t matter whether you participate in the plan, just whether your boss provides the opportunity.

Then, it comes down to your household adjusted gross income (AGI). Here are the important numbers if you are NOT covered by a retirement plan at work. Here are the numbers if you are covered by a retirement plan at work.

Contributions to a Roth IRA are never deductible, but your income will determine how much you can contribute, including whether you can contribute to a Roth at all. Here are the income limits for 2012.

Click the big green button to join the thousands of people celebrating Worldwide Invest Better Day on Sept. 25!

Robert Brokamp and The Motley Fool have no positions in the stocks mentioned above. Motley Fool newsletter services recommend Procter & Gamble. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2027684, ~/Articles/ArticleHandler.aspx, 10/26/2016 1:26:25 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,211.18 41.91 0.23%
S&P 500 2,139.33 -3.83 -0.18%
NASD 5,262.08 -21.32 -0.40%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/26/2016 1:11 PM
PG $87.23 Up +0.26 +0.30%
Procter and Gamble CAPS Rating: ****