First time home buyer using IRA
I've been planning to save some money to buy a house in the next few years. I am 21 and working on building a solid credit score. Additionally, I've been investing some money with Lending Club (peer to peer lending). They have the option of IRA investment accounts. From what I understand, these accounts are tax free. Also, I hear that you are allowed to contribute up to ,000 a year to an IRA, and you are able to pull out ,000 for your first home. So my question is:
Should I create an IRA account and fill it up to ,000 mark for my first home purchase? Should I use a traditional IRA or Roth IRA for this?
(1)1 Comments
Sorted by latest first Latest Oldest Best
I think you're missing several key issues here.
First for the facts:
IRA contributions are 00 a year maximum (currently, it changes with inflation), i.e.: you cannot deposit K in an IRA account in a single year.
IRA withdrawals can only be made if you have something liquid in the IRA. You cannot withdraw from Lending Club IRA unless you manage to sell the notes currently held by you there.
Roth IRA is funded with after-tax money, and you can withdraw your deposits in Roth IRA any time for any reason. No 10K limit there, only limited by what you deposited.
However the main thing you're missing is this:
You can withdraw up to K from your IRA for first home purchase without penalty. Pay attention: not without tax but without penalty. So what is the point in depositing k into IRA just to withdraw it the next year?
Terms of Use Privacy policy Contact About Cancellation policy © freshhoot.com2026 All Rights reserved.