You may not have the pictures, suntan or souvenirs to show for it, but if you’re at least 70-1/2, you’ve just finished a “vacation.”  And that means you’ll have to do some work — on determining how much to take out of your retirement plans this year.
Typically, when you reach 70-1/2, you must start taking withdrawals (“required minimum distributions,” or RMDs) from your traditional IRA or your employer-sponsored retirement plan, such as a 401(k), 403(b) and 457(b). However, the sharp decline in the financial markets in 2008 led Congress to give you a one-year vacation from taking RMDs in 2009 so that you wouldn’t have to cash out assets whose value had fallen significantly.

Most investors pay a great deal of attention to the price of their investments —  yesterday’s price, today’s price, tomorrow’s price, next year’s price and so on. And that’s understandable, because we always want the prices of our investments to rise. Yet, if you focus too much on prices, you could end up making some costly mistakes.
Why? Because price-driven behavior is emotional behavior — and as an investor, you’re much better off making decisions with your head, not your heart. Suppose, for example, that you’ve seen a steep decline in the price of one of your investments. After a while, you may feel that you just can’t take it anymore and you decide to “cut your losses” by selling the investment.  Conversely, you may have an investment that has gone up and up — and to grab even bigger gains, you buy more shares.

Valentine’s Day is fast approaching, so you’d better get going with the flowers and chocolates for your sweetie. But this year, why not go beyond the traditional gifts and give a present that can make a difference in your loved one’s life for years to come? Specifically, why not give a financial gift?
Of course, you could always put some cash or a check in a card, but with a little creativity, you can make a financial gift that has a longer-lasting and more profound impact.

If you already have a Roth IRA, you’re aware of its biggest benefit: Your earnings grow tax free, provided you meet certain conditions. If you don’t have a Roth IRA, you may want to consider one — and it may be easier for you to do just that in 2010.
Before we get to the reasons why 2010 may be your year to open or convert to a Roth IRA, let’s look at some differences between Roth and traditional IRAs. If you own a traditional IRA, your contributions may be tax-deductible, depending on your income level. But whether you can make deductible contributions or not, your earnings grow on a tax-deferred basis, which means your money can grow faster than it would if it were placed in an investment on which you paid taxes every year. On the other hand, Roth IRA contributions are never tax-deductible, but your earnings grow tax free, as long as you’ve held your account at least five years and you don’t start taking withdrawals until you’re at least age 59½.