iDeco dependent spouse - any benefit over NISA?

[ruku]

Hi,

I'm just about to open iDeco and NISA accounts for myself. As a public worker in Japan, my possible iDeco amount is very limited (12,000).

My wife is currently a dependent spouse, and we are trying to decide what are the better options for her (we are 45 and 46 respectively). iDeco says she can contribute 27,000. As she is a 'dependent spouse' who is not working, this amount would therefore logically come from my income. Can I claim a tax exemption on my income for her iDeco contribution? If not, what is the benefit of a dependent spouse opening an iDeco? Should they not then in all cases use only NISA?

Any help/ clarification would be much appreciated!

[RetireJapan]

For a dependent spouse, I would recommend maxing out NISA first.

iDeCo's main benefit is the income tax reduction, and it is applied to the individual, not their working spouse. With little or no taxable income there is little benefit. If you still have extra money to invest after maxing out both your NISAs and your iDeCo, it might be worth looking at iDeCo for your wife too.

Bear in mind that investment accounts in your wife's name are hers, regardless of where the funds originally come from.

[ruku]

Thanks for the clarification and recommendation!

[beanhead]

iDeco says she can contribute 27,000.

Isn't it 23,000 yen per month, 276,000 yen per year?

[Copyleft]

iDeco says she can contribute 27,000.

Isn't it 23,000 yen per month, 276,000 yen per year?

I think they have categories, i let all stuff with my beloved wife but if i remember well they have 3 categories

[beanhead]

I think they have categories, i let all stuff with my loved wife but if i remember well they have 3 categories

Yes, correct. I just thought the dependent spouse contribution was fixed at 23,000 (probably wrong, trust what the government tells you over me).

In your situation, NISA is more flexible, so as RJ says, without the tax reduction benefits, it makes sense to set her up with a NISA/tsumitate NISA account first.
Then junior NISAs if you have kids and spare money to invest.
Finally if you still have extra money kicking around, consider iDeCo.