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The 10 costly IRA money mistakes that could sabotage your retirement savings

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From contributions to conversions to distributions, don’t fall into these traps when managing your IRA.

Waiting until the 11th hour to contribute

Investors have until their tax-filing deadline—usually April 15—to make an IRA contribution if they want it to count for the year prior.

Many investors squeak in their contributions right before the deadline rather than investing when they’re first eligible (Jan. 1 of the year before). Those last-minute contributions have less time to compound, and that can add up.

Assuming Roth IRA contributions are best

Funding a Roth instead of a traditional IRA may not always be the right answer.

For investors who can deduct their traditional IRA contribution on their taxes, and who haven’t yet saved much for retirement, a traditional deductible IRA maybe better. That’s because their in-retirement tax rate is apt to be lower than it is when they make the contribution.

Thinking of IRA contributions as an either/or decision

Deciding whether to contribute to a Roth or traditional IRA depends on your tax bracket today versus where it will be in retirement.

If you have no idea and your income allows you to make a deductible IRA contribution, it’s reasonable to split the difference and invest half in each.

Making a nondeductible IRA contribution for the long haul

If you earn too much to contribute to a Roth IRA, you also earn too much to make a traditional IRA contribution that’s tax-deductible.

The only option open to taxpayers at all income levels is a traditional nondeductible IRA, but this subjects investors to two big drawbacks: required minimum distributions (RMDs) and ordinary income tax on withdrawals.

Assuming a backdoor Roth IRA will be tax-free

The backdoor Roth IRA should be a tax-free or nearly tax-free maneuver in many instances.

But for investors with substantial traditional IRA assets that have never been taxed, the maneuver may be partially taxable, thanks to “ the pro rata rule.”

Assuming a backdoor Roth IRA is off-limits

Investors with substantial traditional IRA assets that have never been taxed shouldn’t automatically rule out the backdoor IRA idea, however.

If they have the opportunity to roll their IRA into their employer’s 401(k), they can effectively remove those 401(k) assets from the calculation used to determine whether their backdoor IRA is taxable.

Not contributing to an IRA later in life

Making Roth IRA contributions later in life can be attractive for investors who plan to pass the money on to their heirs, who in turn will be able to take tax-free withdrawals. After all, Roth IRAs don’t impose RMDs. Traditional IRA contributions will tend to be less attractive for older adults because they do.

Delaying IRA contributions because of short-term considerations

Investors might put off making IRA contributions, assuming they’ll be tying their money up until retirement. Not necessarily.

Roth IRA contributions can be withdrawn at any time and for any reason without taxes or penalty, and investors may withdraw the investment-earnings component of their IRA money without taxes and/or penalty under specific circumstances.

Running afoul of the Roth IRA five-year rule

All investors must satisfy the “ five-year rule,” meaning that the assets must be in the Roth for five years before they begin withdrawing them. And things get more complicated if your money is in a Roth because you converted traditional IRA assets.

So, get some tax advice if you need to pull money out of a Roth IRA shortly after depositing it.

Doubling up on tax shelters in an IRA

It also makes sense to avoid any investment type that offers tax-sheltering features itself. That’s because you’re usually paying some toll for those tax-saving features, which you don’t need because the money is inside of an IRA.

This article was provided to The Associated Press by Morningstar. For more personal finance content, go to https://www.morningstar.com/personal-finance

This story was originally featured on Fortune.com



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The new workplace trade-off: Employers are offering ‘recharge days’ to soften the blow of return to office

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Henry Ford brought the 40-hour workweek to the Western world nearly a century ago, believing that giving workers eight hours of labor, eight hours of recreation, and eight hours of rest would improve retention and morale.

However, between commutes, school runs, and last-minute holdbacks at the office, it took a pandemic-induced global shutdown to realize that 8-8-8 had slowly morphed into something more like 12-6-6. Working from home briefly allowed workers to claw back some of that time.

Now, as leaders increasingly order staff back to the office, they’re sweetening the deal by giving them some time back.

Jackson Healthcare (No. 99), Intuit (No. 78), Sheetz (No. 40), and many others provide workers with wellness centers where they can exercise, receive nutrition advice, or even talk through their mental health struggles.

Nonprofit health care provider Wellstar Health System (No. 93) has an extensive range of benefits aimed at giving its 28,000 workers a breather, including 16 “wellness rooms” across major locations. The spa-like spaces come complete with massage chairs, calming music, and healthy snacks. It has proved popular with employees, and turnover last year decreased by 10%.

What’s more, the company is even paying workers up to $310 a year to prioritize well-being. Intuit similarly rewards employees for taking care of their health with a $1,300 annual Well-Being for Life reimbursement, which can be used for purchases such as a treadmill.

Other firms are more tangibly putting time to recharge back in the hands of their staff with literal days off the job to do exactly that.

The luxury Palm Beach resort the Breakers (No. 63) offers a four-day week when it’s fully staffed. Not only does that give workers respite, but, the company explains, it prevents overstaffing during slower periods. Meanwhile, Fannie Mae (No. 12) offers staff Flex Fridays whereby from 1 p.m. workers can shut down their laptops for an early weekend.

Of course, not all businesses are willing to commit to weekly time off. But many opt for “recharge days” or company-wide breaks to provide that structured downtime without a fixed schedule.

ServiceNow (No. 30) gives staff six additional annual paid days off to focus specifically on wellbeing; HP (No. 90) offers an annual “me day” for the same reason, and IHG (No. 17) provides three “recharge days” a year.

Tax services and software provider Ryan (No. 35) introduced a full-week closure in July, known as the Ryan Break. “This time acknowledges the need for time off not related to holidays and time when the entire company is closed,” Ryan says. Vertex Pharmaceuticals (No. 44), similarly, closes business for a week in the summer and at Christmas.

And then there’s law firm Perkins Coie (No. 89), which goes one step further and empowers workers to take a proper break from the workday grind with a paid sabbatical—that is, around four to eight weeks off at full pay after 10 years of service, and every 10 years thereafter, to “rejuvenate.” And team members at every level can take advantage of the policy.

But by far the most popular work-life balance policy being adopted by the 100 Best Companies to Work For is compressed hours—with nearly half offering the option.

Delta Air Lines (No. 15), PwC (No. 20), and Dow (No. 25) are among the many employers empowering staff to pursue more flexible schedules, like working longer Monday through Thursday in exchange for a three-day weekend. One thing is clear: Employers who invest in flexibility reap the rewards of a happier staff.

More on the 2025 Best Companies to Work For:

This article appears in the April/May 2025 issue of Fortune.

This story was originally featured on Fortune.com



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Elon Musk defeated in Wisconsin Supreme Court race after spending almost $25 million to back losing candidate

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Judge Susan Crawford preserved liberals’ narrow majority on the Wisconsin Supreme Court Tuesday by defeating conservative Brad Schimel, but in a way the real loser of the election was billionaire Elon Musk.

Musk and his affiliated groups sunk at least $21 million into the normally low-profile race and paid three individual voters $1 million each for signing a petition in an effort to goose turnout in the pivotal battleground state contest. That made the race the first major test of the political impact of Musk, whose prominence in President Donald Trump’s administration has skyrocketed with his chaotic cost-cutting initiative that has slashed federal agencies.

Crawford and the Democrats who backed her made Musk the focus of their arguments for holding the seat, contending he was “buying” the election, which set records for the costliest judicial race in history.

“Today Wisconsinites fended off an unprecedented attack on our democracy, our fair elections and our Supreme Court,” Crawford said in her victory speech. “And Wisconsin stood up and said loudly that justice does not have a price, our courts are not for sale.”

Trump endorsed Schimel as the race turned into a proxy fight over national political issues. The state’s high court can rule on cases involving voting rights and redistricting in a state likely to be at the center of both next year’s midterm elections and the 2028 presidential contest.

But Musk’s involvement dialed those dynamics up to 11: “A seemingly small election could determine the fate of Western civilization,” the billionaire said Tuesday in a last-ditch call to voters on his social media site X. “I think it matters for the future of the world.”

Notably, America PAC, the super PAC backed by Musk, spent at least $6 million on vendors who sent door-to-door canvassers across the state, according to the non-partisan Wisconsin Democracy Campaign. It was a reprise of what the group did across the seven most competitive presidential battleground states, including Wisconsin, which were carried by Trump in November.

But the end results this time were not good for Musk. Despite the millions he spent on Schimel, as of late Tuesday night the Supreme Court candidate was losing by four percentage points more than the other Republican-backed statewide candidate, Brittany Kinser, who also fell short in her bid for superintendent of public instruction.

Musk’s court race defeat wasn’t only because of crushing Democratic margins in deep blue cities like Madison and Milwaukee. Crawford’s margins were higher in places where the Musk-backed group America PAC had been active, including Sauk County, just north of Madison, which Crawford was carrying by 10 points after Trump won it by less than 2 points in November.

In Brown County, the home of Green Bay where Musk headlined a campaign rally with 2,000 people on Sunday, Crawford beat Schimel. Trump won the county by 7 percentage points last year.

Overnight, Musk posted on his X platform that “The long con of the left is corruption of the judiciary.” In another comment, he seemed to take solace from voters’ approval to elevate the state’s photo ID requirement from state law to constitutional amendment. The platform was rife with criticism from Trump opponents for his involvement in the race.

“Please send @elonmusk to all the close races!” Jon Favreau, former speechwriter for President Barack Obama, wrote.

“Elon Musk is not good at this,” J.B. Pritzker, Illinois’ Democratic governor and a billionaire himself who donated to support Crawford, posted on X.

Voters definitely had Musk on their minds.

“There’s an insane situation going on with the Trump administration, and it feels like Elon Musk is trying to buy votes,” said Kenneth Gifford, a 22-year-old Milwaukee college student, as he cast his ballot on Tuesday. “I want an actual, respectable democracy.”

Others may not have had their vote decided by the billionaire but were all-too aware of the money pouring into their state.

Jim Seeger, a 68-year-old retiree who previously worked in communications and marketing, said he voted for Schimel because he wants Republicans to maintain their outsized majority in Wisconsin’s congressional delegation, which could be at risk if Crawford wins and the court orders the maps redrawn. But, he added, he was disappointed the election had become a “financial race.”

“I think it’s a shame that we have to spend this much money, especially on a judicial race,” Seeger said as he voted in Eau Claire.

Wisconsin’s Democratic Attorney General, Josh Kaul, sued to bar Musk from making his payments to voters if they signed a petition against “activist judges.” The state Supreme Court unanimously declined to rule on the case over a technicality.

Musk swooped into the race shortly after Trump’s inauguration. Republicans were pessimistic about being able to win the seat. They lost a longtime conservative majority on the state high court in 2023, and Democrats have excelled in turning out their educated, politically tuned-in coalition during obscure elections such as the one in Wisconsin.

Musk duplicated and expanded on some of the methods he used in the final weeks of last year’s presidential race, when he spent more than $200 million on Trump’s behalf in the seven swing states, including Wisconsin.

This time, in addition to the $1 million checks, Musk offered to pay $20 to anyone who signed up on his group’s site to knock on doors for Schimel and posted a photo of themselves as proof. His organization promised $100 to every voter who signed the petition against liberal judges and another $100 for every signer they referred.

Democrats were happy to make Musk a lightning rod in the race.

“People do not want to see Elon Musk buying election after election after election,” Wisconsin Democratic Party Chair Ben Wikler said Monday. “If it works here, he’s going to do it all over the country.”

This story was originally featured on Fortune.com



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Oatly was a pioneer in oat-based dairy challengers—it still has to prove it’s more than a fad

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