Learn how a Putnam IRA can help you save for retirement

8/9/2019 Learn how a Putnam IRA can help you save for retirement

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putam.om/ira

Lear how a PutamIRA a help yousave for retiremetTraditioal ad Roth
http://www.putnam.com/irahttp://www.putnam.com/http://www.putnam.com/ira


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ow will you use your IRA savis?The vast majority of Traditioal IRA owers pla

to make withdrawals to pay for livi epeses.

tment Company Institute, The Role of IRAs in U.S. Households

g for Retirement, 2009.

Health-careexpenses

einvestmentor savingin anotheraccount

notheroption

mergencyexpenses

ngenses


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Choose the IRA thats right for you:

Traditional or Roth

Your IRA should t your life. For some, that may mean a tax-deferred Traditional

IRA. For others, a tax-free Roth IRA may make more sense. The big dierence

between the two account types is when your investments get taxed: With

Traditional IRAs, you pay taxes when money is withdrawn; contributions to Roth

IRAs are made with money that has already been taxed.

Traditional IRA

Do you anticipate being in a lower income

tax bracket in retirement?

I so, a Traditional IRA may be or you. The money

you contribute now is tax-deductible, while

withdrawals in retirement are taxed as income.

Are you looking to reduce your taxable income?

I reducing your taxable income would put you in

a lower income tax bracket, the tax-deductible

contributions you make to a Traditional IRA can

help you reduce your tax liability.

Roth IRA

Would you benet rom tax-ree income

in retirement?

I you already have money invested in a tax-deerred

account such as a 401(k) and a taxable account such

as a money market und at your local bank a Roth IRA

could be a good ft or you. Investing in a Roth IRA can

provide you with a source o tax-ree income in retirement.

Is retirement still a way of or you?

I you have many years let until retirement, a Roth IRA

may be worth considering. The longer your account has the

potential to grow, the more you could stand to save on taxes

when it comes time to make withdrawals in retirement.

Its reassuring to know

that no matter where my career

takes me, theres an IRA that

ts my goals.

IRAs are an increasingly popular way to save.

More than 46 million U.S. households own at

least one IRA today.

Investment Company Institute, The Role of IRAs in U.S. Households

Saving for Retirement, 2009.


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Makesureyoufully

understandthedieren

ces

betweenaTraditional

andaRothIRAbefore

youinvest.

Traditional IRA Roth IRA

DIRS

Anyone can contribute, regardless o income*

Tax-deductible contributions

Tax-deerred growth o earnings

Tax-ree growth o earnings

Tax-ree withdrawals

o restrictions due to employer-sponsored

retirement plan eligibility

ontributions permitted ater age 70

Minimum withdrawals required by age 70

ontributions may be withdrawn at any time tax ree

SIMIARITIS

The two account types have a number o similarities, including the ability to make catch-up contributions i youre over age 50

and the exibility to take penalty-ree withdrawals in certain situations.

ontribution limit$5,000 if under age 50

$6,000 if age 50 or older

Same

Age or earliest penalty-ree withdrawal 591 591

Allows penalty-ree withdrawals in certain situations

(rst-time home purchase, certain medical expenses, etc.)

an accept direct rollovers rom workplace retirement plans

1I you are over age 70 or have $0 in income, you cannot contribute to a Traditional IRA.

2ontributions to a Roth IRA can be withdrawn at any time.


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Does a Roth conversion

make sense for you?Will your tax rate be higher in retirement?

I youre worried about acing higher tax rates in

retirement, a Roth conversion may be the solution.

All withdrawals made ater age 59 are ree rom

ederal income taxes, as long as the account has

been open or at least fve years.

Do you already own taxable and tax-deerred

savings accounts?

Many fnancial experts agree that diversiying thetax treatment o your savings accounts is a prudent

move that can help you prepare or unoreseen changes

in tax rates down the road. That means owning a mix

o taxable, tax-deerred, and tax-ree accounts,

such as a Roth IRA.

Do you want to leave a nancial legacy to your

children or grandchildren?

Neither you nor your spousal benefciary are required to

make withdrawals. And your children or grandchildren

who inherit the IRA can take the minimum required

distributions based on their lie expectancies, extending

the tax-ree growth or years.

Do you have the unds to pay taxes on a conversion?

Beore you decide to convert to a Roth IRA, make sure youhave the unds outside o existing retirement accounts to

pay the income taxes due. Tapping into your nest egg to

pay your tax bill is usually counterproductive.

Keep in mind, i you fnd your tax bill is too high or i

your account posts a signifcant decline, you can always

undo, or recharacterize, all or a portion o your Roth IRA

conversion without penalty, as long as you do so beore

the tax-fling deadline, plus extensions.

1Income limits are based on modiied adjusted gross income (MAGI).

2The spousal beneiciary is not required to make withdrawals i they take the inherited account as their own.

3Account must have been established or at least ive years prior to inheritance.

Consider the tax benets

of converting to a Roth IRA

Since Roth IRAs were rst introduced, tax lers earning more than $100,000* have

been ineligible to convert existing accounts. But thanks to changes in the tax law,

if you have money in a tax-deferred retirement account, you now have the option to

convert it to a Roth IRA regardless of your income.


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What are the next steps

for converting to a Roth IRA?

Se 1: Discuss your specic situation with

your tax proessional or nancial advisor.

Converting an account has signifcant tax implications

now and in retirement. Make sure you understand how

converting fts into your long-term investment goals.

Se 2: Decide how much o your savingsyou want to convert.

You can elect to convert only a portion o your

traditional retirement account.

Se 3: Decide how youll pay taxes due on

the conversion.

Youll pay income taxes on the value o the account

(including both pretax contributions and earnings).

It is recommended that you have assets outside o

your retirement accounts to pay the taxes due on aRoth conversion.

Se 4: ill out an account application and

choose your investments.

Your fnancial advisor can walk you through the

application process and will send the completed

orms to Putnam.

Get the facts.

putnam.com/rothira

Use our online conversion evaluator to put yourunique retirement savings situation in perspective.

rothirablog.com

Get the latest updates on saving for retirement

from our panel of experts.
http://www.putnam.com/rothirahttp://www.putnam.com/rothira


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International investing involves certain risks, such as currencyuctuations, economic instability, and political developments.

Additional risks may be associated with emerging-market securities,

including illiquidity and volatility.

The funds invest some or all of their assets in small and/or midsize

companies. Such investments increase the risk of greater price

uctuations.

Lower-rated bonds may oer higher yields in return for more risk.

Funds that invest in government securities are not guaranteed.

Mortgage-backed securities are subject to prepayment risk.

The rst suite of lifecycle funds to integrate absolute return strategies

2055 2050 2045 2040 2035

Asset allocation Absolute return Money market

Invest in one easy step with

Putnam RetirementReady Funds

Putnam RetirementReady Funds take the guesswork out of investing your IRA

assets by combining the best of Putnams asset allocation strategies for growth

with our absolute return strategies for lower volatility, in one innovative package.

Built with retirement in mind

With Putnam RetirementReady Funds, each portolio

is targeted to match your specifc retirement date while

automatically growing more conservative over time.

Just pick the portolio that most closely matches the

year in which you plan to start withdrawing money

and youre done.

xperienced managers With more than 16 years o

experience managing multi-asset-class portolios,

Putnams RetirementReady und managers are some

o the most tenured in the industry.

With 25 years to mat

the RetirementReady

2035 und is invested

global mix o stocks a

bonds seeking growt

A portion is reserved

absolute return strate

to help smooth out th

bumps along the way


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Money market funds are not insured or guaranteed by the Federal DepositInsurance Corporation (FDIC) or any other governmental agency. Although

the fund seeks to preserve the value of your investment at $1.00 per share,

it is possible to lose money by investing in this fund.

Funds that invest in bonds are subject to certain risks including interest-rate

risk, credit risk, and ination risk. As interest rates rise, the prices of bonds

fall. Long-term bonds are more exposed to interest-rate risk than short-term

bonds. Unlike bonds, bond funds have ongoing fees and expenses.

Principal value of the funds is not guaranteed at any time, including the

target date.

2030 2025 2020 2015 Maturity

A range o investment opportunities The unds

provide exposure to traditional investments such as

stocks and bonds, as well as to alternative asset classes

such as real estate, emerging markets, and international

currency markets.

Active investment management Unlike target-maturity

strategies that use a und-o-unds approach, each

RetirementReady portolio is proessionally managed or

comprehensive diversifcation, active risk management,

and ecient rebalancing.

At maturity, this

RetirementReady und

is invested primarily

in strategies designed

to minimize volatility

while preserving

enough o the growth

strategies to stay ahead

o ination.


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Absolute return undsare designed or a wide range o

investors and pursue positive returns with less volatility

over time than more traditional unds.

Asset allocation unds invest in a mix o many dierent

types o investments to help weather changing market

environments.

Income unds invest in bonds and other securities with

the goal o providing a steady stream o income over time.

Value unds look or stocks that have been overlooked

by other investors and that may be selling or less than

their true worth.

Growth unds look or stocks o companies that have

the potential to grow over time.

Blend unds invest opportunistically in a variety o stocks,

including both growth and value stocks.

Global sector unds invest worldwide in stocks o compa-

nies rom a single economic sector.

I want a portfolio

built for exibility, so I can

take advantage of changing

investment opportunities

in the markets.

Putnam oers more than 100 funds across seven dierent asset classes so youcan build a portfolio from the ground up, designed with your specic investment

goals in mind.

Or create a portfolio

custom built for your goals


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The one account every retirement

saver should consider

You know how important it is to save for retirement. Fortunately, theres an account

that makes it easier. Whether youre just beginning your career or winding it down,

an Individual Retirement Account (IRA) can help you create a more comfortable

retirement. Talk to your nancial advisor to learn more about the benets of a

Putnam IRA.

A simple way to save

Its easy to set up and contribute to an IRA. You can start

a Putnam IRA with as little as $25 a month, and it can be

linked to your checking account so you can make contri-

butions automatically.

Powerful tax advantages

Depending on what type o IRA you decide to open,

youll save on taxes either on the money you contribute

or on the money you withdraw during retirement.

Either way, your contributions will have the potentialor tax-advantaged growth a beneft you wont fnd

in most other types o savings accounts.*

A range of investment options

IRAs oten oer more investment options than the typical

employer-sponsored retirement plan. With a Putnam

IRA, youll have access to more than 100 unds, including

Putnam RetirementReady Funds broadly diversifed

portolios that adjust automatically as you get closer

to retirement.

Endless portability

No matter where your career takes you, your IRA will

ollow. Its the one lietime retirement savings accountevery investor should consider.

1Taxes may be due upon withdrawal, and withdrawals beore age 59 may be subject to an additional 10% penalty.

Im counting on my IRA to help provide my

income in retirement.

Millions o Americans are, and with good reason: IRAs are an efective way to build

your nest egg. The median wealth o households with IRAs was six times greater than

households that did not own IRAs.

Investment Company Institute, The Role of IRAs in U.S. Households Saving for Retirement, 2009.


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One Post Ofce Square

Boston, MA 02109

1-800-719-9914

putnam.com

Putnam Retail Management IR610 266768 3/11

Consider these risks before investing:Asset allocation deci-

sions may not always be correct and may adversely affect fund

performance. The use of leverage through derivatives may

magnify this risk. Leverage and derivatives carry other risks that

may result in losses, including the effects of unexpected market

shifts and/or the potential illiquidity of certain derivatives.

International investments carry risks of volatile currencies,

economies, and governments, and emerging-market securitiescan be illiquid. Bonds are affected by changes in interest rates,

credit conditions, and inflation. As interest rates rise, prices of

bonds fall. Long-term bonds are more sensitive to interest-rate

risk than short-term bonds, while lower-rated bonds may offer

higher yields in return for more risk. Unlike bonds, bond funds

have ongoing fees and expenses. For the 500 Fund and 700

Fund, these risks also apply: Stocks of small and/or midsize

companies increase the risk of greater price fluctuations.

REITs involve the risks of real estate investing, including

declining property values. Commodities involve the risks of

changes in market, political, regulatory, and natural conditions.Additional risks are listed in the funds prospectus.

This information is not meant as tax or legal advice.

You should consult with the appropriate tax or legal

professional before making any investment decisions.

Investors should carefully consider the investment

objectives, risks, charges, and expenses of a fund before

investing. For a prospectus, or a summary prospectus if

available, containing this and other information for any

Putnam fund or product, call your financial advisor or

contact Putnam at 1-800-225-1581. Please read theprospectus carefully before investing.

A bALAnc APPRAc

Since 1937, when George Putnam created a diverse

mix of stocks and bonds in a single, professionally

managed portfolio, Putnam has championed the

balanced approach.

A RL InTIng

Today, we oer investors a world of equity, xed-

income, multi-asset, and absolute-return portfolios

to suit a range of nancial goals.

A cITnT T xcLLnc

Our portfolio managers seek superior results over time,

backed by original, fundamental research on a global

scale. We believe in the value of experienced nancial

advice, in providing exemplary service, and in putting

clients rst in all we do.
http://www.putnam.com/http://www.putnam.com/

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Learn how a Putnam IRA can help you save for retirement