There Goes My Retirement

Last summer, I thought it would be awesome to start a Roth IRA account to save for retirement. I made enough to have money that I can save and I wanted to let this money grow more aggressively. This was all great, until I did my taxes

While preparing my taxes, I found out that the stipend I received was not considered "compensation". You can only contribute to an IRA if you had "compensation". What is considered compensation? Anything with a W-2 form.

If I didn't take the money out, I would be penalize 6% on the amount that over the contribution limit for every year that it is lying in the account. In my case, that would be everything I put in, which is a couple of hundred dollars. Now, If I take it out, I would be penalized still, but to a lesser extent.

So, now, my retirement plan is shot. I have to take it all out.

I think it's unfair. Everything rested on such a technicality of a W-2 form. I'm getting taxed on my stipend, but I can't put it whatever is leftover towards retirement. That just doesn't make sense to me. Who the hell cares what I do with my money, especially after it's already taxed!

The deadline is creeping up and I'm scrambling to get everything done in a timely fashion. I hope it all works out.

Meanwhile, I'm going to try and look at a tax-deferred account for my school, but I could imagine running up to th same problem.

I knew I've condemned myself to poverty by going to graduate school, but I always thought it'll only affect the next six years. Funny how I've screwed over my retirement too.