Should You Make IRA Contributions After 65?

As I was listening to my voicemail on a Saturday morning, I picked up a message from a relative. "Christine, I have some extra money to invest," she said. "I put some cash into my traditional IRA earlier this year, but this time I wonder if I should make a Roth contribution instead. Call me back, please." Uh-oh, I thought to myself.Her basic question, of course, is commonplace--people often want to know which IRA (or 401(k)) contribution type to make, and the right answer is usually not abundantly clear. But my relative is already retired--she's no longer earning an income--and that's where the "uh-oh" comes in. She can't make an IRA contribution at all, because all of her income is unearned income--she lives on income from Social Security and her investment accounts. Only people with income from paid work (or some variant of it, discussed below) can contribute to an IRA. Read More