Will you be able to retire comfortably?

The Taxpayer Relief Act of 1997 greatly expands the usefulness of the traditional IRA. It's more flexible and gives more people access to IRA tax advantages, including:

    * Extension of tax-deductible IRAs to people with higher income levels

    * Tax penalty-free withdrawal from IRAs for qualified educational expenses and for first-time homeowners

You may qualify for:

    * Tax-deductible contributions

    * Tax-deferred accumulation of earnings

    * Competitive interest

    * Substantial lifetime income at retirement

    * Flexibility to make withdrawals for qualified educational expenses or the purchase of a new home

Who can contribute?

If you're under 70 1/2, and have earned income from employment, you can contribute up to $2,000 if you're single or $4,000 if you're married.

More people now qualify for Traditional IRAs

If neither you nor your spouse participate in a retirement plan, each of you can deduct the full $2,000 IRA contribution for a total of $4,000 a year.

If one spouse participates in an employer plan, income limits restricting deductibility of IRAs will apply. These adjusted gross income limitations, which gradually phase out tax-deductible contributions, will increase from $40,000 to $80,000 for joint filers by the year 2007 ($25,000 to $50,000 by the year 2005 for a single taxpayer). A non-working spouse can take the full $2,000 tax deduction if the other spouse participates in a retirement plan, but that is phased out beginning at $150,000 joint adjusted gross income.

Flexible Withdrawal Options

Withdrawals from Traditional IRAs are taxable in the year withdrawn. Withdrawals before age 59 1/2 are subject to a 10 percent penalty-tax unless withdrawn:

    * to pay the costs of buying a principal residence by a first-time home buyer (limited to $10,000)

    * to pay qualified higher education expenses

    * due to death or disability

    * to pay certain medical or health insurance expenses

Lifetime income options at retirement

Traditional IRA retirement plans convert to flexible, guaranteed lifetime annuities of your choice, when you retire. Farmers annuities offer income options including income you cannot outlive.

Retirement Insurance

Murray Sullivan | Insurance Agent | 10752 N 89th Place, Suite 206 | Scottsdale, AZ 85260

*Life insurance issued by Farmers New World Life Insurance Company, Mercer Island WA 98040