What retirement accounts does Composer offer?

Composer offers two types of retirement accounts: Roth IRAs and Traditional IRAs. To understand which account makes sense for you, consider their differences in eligibility, as well as treatment of earnings, contributions, and withdrawals.

Roth IRAs

If you are 18 or older and have earned income within specific IRA income limits, you can contribute to a Roth IRA. Contributions are made with after-tax dollars, and therefore are not deductible. Withdrawals of contributions are never subject to taxes or penalties at any time. Withdrawals of earnings are not subject to taxes or penalties after age 59½, provided that the account has been open for 5+ years. If you withdraw earnings before the age of e 59½, you may be required to pay taxes on your earnings, plus you may need to pay a 10% tax penalty. You can read more about Roth IRAs on the IRS website.

Traditional IRAs

Anyone aged 18 or older with earned income can contribute to a Traditional IRA. Contributions are made with pre-tax dollars, and therefore may be deductible if certain income requirements are met. Potential earnings grow tax deferred, until withdrawn. Withdrawals of contributions and earnings are subject to taxes. If you withdraw before age 59 ½, you are required to pay taxes on your contributions and earnings, plus you may need to pay a 10% tax penalty. You can read more about Traditional IRAs on the IRS website.

This material is for informational purposes only and is not intended to be a substitute for consultation with a qualified tax professional before making decisions related to your retirement account(s). Visit the IRS website for further information.