IRA accounts are for people who do not earn a lot per year

It is true that the IRS considers that some people earn too much money to be eligible for something like a Roth IRA account. However, those limits are not random, and they are pretty high depending on how you end up filing your taxes each year (it is around $196,000 for joint-married filers and around $133,000 for those who file by themselves).

And when you consider the earlier rule that you can always withdraw money from a Roth IRA account, it makes sense why people with a high income are barred from opening one, as it could easily be abused by some people who look to grow their income and take out money without having to pay taxes on these transactions. Yet, even if you are a high-income person, that does not mean that you can never have a retirement account. You can easily open a traditional IRA account, and you can make contributions to that account.

Despite this, make sure you read the fine print on these accounts before you settle on opening one. When it comes to high earners, the IRS limits how much of your contribution you can deduct from taxes in relation to your overall household income and whether or not you and your partner have a retirement plan opened by your workplace (for example, a 401(k)).

It can be a bit confusing, but if you are set on saving more money for retirement, then make sure you read about these rules rather than go with the myth that “high earners are banned by the IRS from having an IRA account”.

However, sometimes hearsay about IRA accounts is not a myth but rather a rule that not many people are aware of! If you want to have a retirement account, make sure that you check out which assets can be held in them and which cannot here!