Simple IRA/Roth IRA

[L.S.]

If you had a choice of putting money into the Simple IRA or a Roth IRA - which would you do first? I think the Simple because of the tax deduction and also the company matching 3%. It is possible to put money in both - up to the limits, correct? When withdrawing the money from the Simple, this is taxable, right. Do you HAVE to start withdrawing at age 59 1/2?

thanks

[mcb39]

If you had a choice of putting money into the Simple IRA or a Roth IRA - which would you do first? I think the Simple because of the tax deduction and also the company matching 3%. It is possible to put money in both - up to the limits, correct? When withdrawing the money from the Simple, this is taxable, right. Do you HAVE to start withdrawing at age 59 1/2?

thanks

You do NOT have to start withdrawing at 59 1/2. The requirement is 70 1/2 and that has even been waived in this terrible economy. I generally recommend the Simple or Conventional unless the client is very young. With good financial planning from 59 1/2 on,; you can usually get away with paying little or no income tax on the distributions that were not taxed when they were invested. Each case is different.