SoFi Blog

It’s the beginning of a perfect modern romance: You met on an app, and after engaging in some above-average banter, you’ve been on two drink dates and out to dinner at least once. You’ve finally saved their number in your contacts under their real name (as opposed to “John/Jane Bumble”), and you’re feeling good about moving out of the “hanging out” stage toward something more serious.

And then, out of nowhere, your potential future mate drops a bomb —they’ve got debt, and lots of it. They’re carrying $100K+ in student loans. Do you walk away or stay? And if you do stay, who pays for dinner?

We’ve got debt on the brain year-round here at SoFi, but with Valentine’s Day just days away, we’ve got love on the brain too, so we surveyed 2,000 Millennials to learn more about how they think about debt in the context of their love life.

By using our Traditional, SEP, and Roth IRA Contribution Calculator above you
can learn more about how much you can contribute this year to each retirement
account—

Traditional IRA

A traditional IRA (individual retirement account) is a retirement account that
you can open and fund yourself, that may carry certain tax advantages. This
account is not through an employer.

Contribution limits

for 2023 are: $6,500 or $7,500 if you are 50 years or older. Contributions you
make to a traditional IRA may be fully or partially deductible, depending on
your filing status and income.

Generally, amounts in your traditional IRA (including earnings and gains) are
not taxed until you takea distribution (withdrawal) from your IRA.

Learn More:

What Is an IRA? Types and Benefits, Explained

Roth IRA

A Roth IRA is also a retirement account that you open and fund yourself (not
through an employer). However, this account is different from a traditional
IRA because you contribute after-tax money to it, and if you meet the
requirements you can make your distributions tax-free. You cannot deduct
contributions to a Roth IRA. You can make contributions to your Roth IRA after
you reach age 70 ½. You can leave amounts in your Roth IRA as long as you
live.

Contribution limits

for 2023: $6,500, or $7,500 if you are over 50 years old. Income limitations
apply.

Learn more:

What Is a Roth IRA and How Does It Work?

SEP IRA

A SEP IRA (Simplified Employee Pension) is a retirement account for small
business owners or self-employed people.

Contribution limits

for 2023: Whichever is lower of $66,000 or 25% of compensation per employee.
Other limitations may apply.

Simplified Employee Pension (SEP) plans can provide a significant source of
income at retirement by allowing employers to set aside money in retirement
accounts for themselves and their employees. A SEP does not have the start-up
and operating costs of a conventional retirement plan and allows for a
contribution of up to 25 percent of each employee’s pay.

SEP IRAs are available to any size business and are easily established by
adopting Form 5305-SEPPDF, a SEP prototype, or an individually designed plan
document. Of note, if Form 5305-SEP is used, you cannot have any other
retirement plan (except another SEP). There is no filing requirement for the
employer and only the employer contributes to traditional IRAs (SEP-IRAs) set
up for each eligible employee. Additionally, the employee is always 100%
vested in (or, has ownership of) all SEP-IRA money.

Learn more:

What Is a SEP IRA and How Does It Work?

Next Steps

Ready to invest for your retirement? It’s easy to get started when you

open an IRA online

with SoFi. SoFi doesn’t charge commissions, but other fees apply

(full fee disclosure here).