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Before Making That 2011 IRA Contribution, Make Sure Your Pension Plan Assets are Safe

The middle of April is fast approaching and everyone knows what that means - time to get those 2011 income tax returns filled out and filed.

What few people realize is that they also have until Monday, April 16, to open a new individual retirement account (IRA) for 2011 or make your annual contribution to an existing one.

With the limit for contributions this year set at $5,000 - or $6,000 for those over age 50 - putting cash in a regular or Roth IRA can shave a big chunk off your personal tax bill.

In addition, this year you may also be eligible for a special "Savers Credit" of up to $1,000 for contributions to either an IRA or an employer-sponsored retirement plan.

I like getting added deductions or credits for putting my money in my retirement plan, if only because I'm a big fan of giving the government the least amount of cash I can legally get away with.

I can't, however, say whether such contributions are right for you - your accountant or tax adviser will have to help you with that decision.

What I can say is this...

If you do put money in a pension plan, whether self-directed through a custodial agent or via an employer-sponsored plan, make sure you know exactly where your money is going - and who's really managing it once it gets there.

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