Welcome to Happy Hour! Sit back, relax, and enjoy some of the great reads and topics I found interesting to wrap up the week.
The Mega Million Lottery Taxes
If you don’t know already, the Mega Millions lottery drawing is sitting at $540 million. It will probably end even higher, but at the moment it means a lump sum payout of $389.8 million or 26 annual payments of about $20.7 million. The return on investment is incredible. But so are the state lottery income and withholding taxes. So if you happen to be the lucky 1 in 176 million to win, be ready to pay. Not a bad deal for the states, since it keeps about 40% of ticket revenues too. Looks like the states always hit it big!
The Roth IRA Movement
Jeff Rose, at Good Financial Cents, was the mastermind behind the recent Roth IRA Movement. It’s all about improving financial literacy for young adults. You couldn’t have kicked off April’s Financial Literacy month any better. When you have some free time, head over and check out the 140 plus bloggers that contributed so far.
For this weeks edition of Last Call, I wanted to feature a few great articles from the Roth IRA Movement. In no particular order:
- The Ultimate IRA Cheat Sheet – I love the math behind the IRAs, but I also know it causes headaches for others. Frugal Toad has a great infographic that paints a good picture of IRAs.
- Earned Income: The Bane of the Graduate Student’s Roth IRA - Yes it says graduate student, but it’s not a prerequisite. What’s important is the earned income requirements of a Roth IRA and Evolving PF does a great job covering it.
- Starting You Kid’s Roth IRA – One of the big benefits of a Roth IRA is the lack of age restrictions. As long as someone has earned income, they can contribute to a Roth. Which means it can be a great deal for kid’s too.
- Good and Bad Reasons to Contribute to a Roth IRA - As great as the Roth IRA is, it’s not perfect for everyone. The Oblivious Investor offers a healthy reminder of that. The best IRA is the one that fits your situation perfectly.
- Anyone Contributing Directly To A Roth IRA Is Stupid - A bit blunt, but the reasoning is sound. It covers an important benefit of doing a yearly Roth conversion. If you’re hands on with your finances, it’s worth reading over.