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Post by The Walk of the Penguin Mich on Jun 3, 2012 14:05:05 GMT -5
I was recently awarded long term disability by my employer for the next year. They are fairly generous in that I will receive 100% of my income for the first 6 months, then 70% until I can go back to work (hopefully early next year). They will continue to pay for my health insurance, and continue to contribute 10% of my income to my 403b.
HR told me that I cannot continue to make MY 403b contributions with my disability, as it will not be earned income. Can I contribute to my traditional IRA with disability income?
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phil5185
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Joined: Dec 26, 2010 15:45:49 GMT -5
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Post by phil5185 on Jun 3, 2012 15:52:02 GMT -5
No - same rule, it has to earned income.
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TheOtherMe
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Post by TheOtherMe on Jun 3, 2012 16:20:49 GMT -5
You must have earned income to contribute to a retirement plan. More important right now is for you to heal.
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bmephdinco
Established Member
Joined: Aug 24, 2011 13:26:10 GMT -5
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Post by bmephdinco on Jun 3, 2012 17:00:17 GMT -5
You can, however, open a taxable investment account and invest money if you want. You just can't contribute to any IRA/401k/403b/etc with disability.
Consider upping your medical savings, emergency fund, etc with the money or paying off any debt you can.
And of course, it's best to focus on your body and not money.
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Deleted
Joined: May 19, 2024 0:25:07 GMT -5
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Post by Deleted on Jun 3, 2012 18:26:45 GMT -5
She needs to do something with her mind while she's recuperating! Get a taxable Vanguard account & make the deposits you were planning into that. You can play with some investing while you can't do your regular job, although maybe stay away from transactions if you are on pain meds!
I think part of your income was from insurance your paid for, so that part wouldn't be taxable & maybe that creates some of the income offset you were looking for from a 401K.
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