Maxed Out Your Roth IRA? What to do Next

Starting a Roth IRA is one of the best decisions you can make in regards to saving for retirement.Before we go any further, let's examine the definition of a Roth IRA (as shared by RothIRA.com):

"A Roth IRA is a special retirement account that you fund with post-tax income (you can't deduct your contributions on your income taxes). Once you have done this, all future withdrawals that follow Roth IRA regulations are tax free."

While it can be frustrating to miss out on the tax deduction each year, it's nice to know that you'll be able to withdrawal money in retirement tax free.In a perfect world, you'd be able to contribute as much money to a Roth IRA as you want. Unfortunately, this isn't the way things work.Here's what the IRS has to say about this:

"For 2015, 2016, 2017 and 2018, your total contributions to all of your traditional and Roth IRAs cannot be more than: $5,500 ($6,500 if you're age 50 or older), or your taxable compensation for the year, if your compensation was less than this dollar limit."

In other words, you can only contribute so much money each year before you have to find another outlet for your savings.While there are many investing strategies to consider, here's something you may want to think about if you've maxed out your Roth IRA: whole life insurance.

Why Purchase Whole Life Insurance?

With your Roth IRA maxed out, you need another place to shelter your money. When doing so, you want to think about the here and now, as well as what will benefit you and your family in the future.Here are some of the many reasons why whole life insurance is a great idea:

• There is no limit as to how much coverage you can purchase
• You can buy one whole life insurance policy after the next
• Your death benefit is paid out tax free
• You can access funds from your policy tax free in the future, much the same as a Roth IRA

While all of these benefits are sure to pique your interest, it's the last one that many people are unfamiliar with.When you borrow from the cash value of your whole life insurance policy, any withdrawal up to the amount of what you've paid in is tax free.This may not sound like a big deal right now, but you may need access to this money at some point in the future. You never know when it could come in handy to pay for education expenses, a home improvement project, or anything else that comes into your life.

Final Thoughts

While some people max out their Roth IRA every year and then stock their money in a savings account, others have come to find that they can get more by turning to another type of investment: whole life insurance.If you've yet to consider this strategy, now's the time to change your ways. You may soon realize that investing in a whole life insurance policy is a great way to enjoy benefits now and in the future, while also keeping your family financially secure.