Spencer Law Firm LLC
717.207.7935 866.639.5451

BAD IDEA No. 1 - Access your IRA with a Debit Card

Entrust Group launched a new service for IRA owners. Now you can access your IRA with the swipe of a debit card.  Want that new pair of shoes -  go ahead -  use your IRA money.  Want to go on vacation - use your IRA.

This is the worst idea I have heard in a long time.  Phyllis Furman, writing for the Daily News: "The IRA Card is the new and improved way to access your Individual Retirement Account," said Entrust CEO Hugh Bromma.

"It's just like any other debit card. You can use it at a store, restaurant or travel agency."

But critics of products like the IRA Card and 401 (k) cards warn they can be dangerous because they allow you to quickly tap into funds that should be locked away and growing for your retirement.

"Retirement money is to be used for retirement," said John Graziano, a CPA with Future Financial Planners in Bayonne, N.J. " 

If you use your IRA debit card, not only do you spend your retirement savings, but you have to pay income tax on the amount withdrawn and, if you are under 59-1/2, pay a 10% premature distribution penalty. 

This is a product option to which we recommend you "Just Say No."

 Blogging credit to Neil Hendershot.

No Comments

Leave a comment
Comment Information

We’d Like to Hear From You

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Contact Information

Spencer Law Firm LLC
320 Race Ave
Lancaster, PA 17603

Toll Free: 866-639-5451
Phone: 717-207-7935
Lancaster Law Office Map

  • MS Logo The American College of Trust and Estate Counsel
  • Super LawyersAV Peer Review Rated
  • fig | figmagazine.com