3 Tools to Build Retirement Savings Before the TrumpIRA Starts

Roth IRAs have the benefit of tax-free growth and tax-free withdrawals later, making them a compelling option for those who expect to be in a higher tax bracket later. However, only those earning an adjusted gross income of $168,000 or less (or $252,000 if married filing jointly) are eligible to contribute. 

In a traditional IRA, which anyone can contribute to regardless of income, funds are taxed when you withdraw them in retirement. However, contributions can be used to lower your taxable income for the same year of the contribution.  

Our favorite IRAs

Many popular banks and investing platforms have both types of IRAs. CNBC Select likes Vanguard since the brand offers both options, doesn’t have commission fees for stocks and exchange-traded fund trades and has no brokerage fees when you sign up for e-statements.  

Typically sold by insurance companies, these contracts are either purchased with a lump-sum payment or paid for over time. They will create a guaranteed income stream either immediately or in the future, no matter how long you live. 

Annuities aren’t the right fit for everyone as they can carry high fees and they might have lower returns than you could see from investing on your own. But the promise of lifetime income can offset those drawbacks for some retirement savers.

There are many kinds of annuities, including variable annuities, which base earnings on the performance of subaccounts that hold investments like stocks, bonds and money market funds. Meanwhile, fixed annuities offer a guaranteed minimum return that you’ll receive no matter what happens in the market. Indexed annuities’ returns track an index like the S&P 500, subject to a maximum cap that varies by policy. 

You can also choose how quickly you want your annuity to start paying out. Immediate annuities start payments as soon as you buy them, while deferred annuities will start paying out at a future point you specify. Some policies allow you to adjust your income start date if your circumstances change.

Our favorite annuities

CNBC Select likes Athene Annuities for its wide variety. It’s also earned excellent marks for financial strength from ratings agency A.M. Best, indicating the company is likely to remain financially strong for years to come — after all, company default is one of the risks that annuity buyers should weigh before buying.

The annuities also have a wide variety of optional riders that can help you meet certain goals, like providing increased liquidity or an enhanced death benefit paid to your heirs. 

We also like New York Life for its low, accessible minimum deposit amount of $5,000 for some types of accounts, which is lower than the $10,000 minimum many other providers require.

If you want to increase your home equity, there are two strategies: pay down your mortgage or increase your home’s value. The latter has less to do with you and more with the market, so we’ll focus on what you can control.

One way to pay down your principal faster is to refinance at a lower rate and plow the money you’re saving as a result each month into your payment. If your credit score has improved, if the rate market has gotten better or if your current mortgage is with a lender that offers higher-than-average rates, chances are you can lower your rate, and thus your monthly minimum payment. 

Our favorites for mortgage refinancing

If you’re looking to refinance to a lower rate, we have some suggestions. 

We like Better Mortgage largely because it’s known for its lower-than-average rates. Plus, you can roll your closing costs into the loan itself, so you don’t need cash up front to get the lower rate — but adding to your principal increases your loan overall.