Roth IRA: How To Go From $542 to $1 Million
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- Опубліковано 10 вер 2024
- In this video, we're going to go through how to start a Roth IRA with as little as $100. A Roth IRA is an individual retirement account that allows you to put money away in order to save for retirement. You're going to want this money to grow so it needs to be invested which we'll talk about.
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Retirement accounts have a reputation for being complicated, but that doesn't have to be the case. With a Roth IRA, you can open an account with as little as $5 and invest in any stocks or funds you want. You won't get a tax deduction when you contribute, but your money will grow tax-free and your contributions can be withdrawn at any time without penalty-even if it's before retirement age. That makes Roth IRAs ideal for people at any age who expect to earn more money over time and don't necessarily need the extra income now. If you're ready to take advantage of this great investment tool, here are all the things you need to know about opening a Roth IRA.
The rules around putting money into a Roth IRA are different than those around most other types of investment accounts. You can put up to $6,500 per year into your Roth IRA-$7,500 if you're over 50-and that amount will be tax-free when it comes out in retirement. It's not just anyone who can contribute though-you need earned income and your adjusted gross income which will be covered in the video. If you happen to make too much money to contribute to a Roth IRA directly then you can take advantage of something called a Backdoor Roth IRA.
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Disclaimer: This video is for entertainment purposes only. Everyone's situation is different so do your own research before making any decisions with your money. If you need help then contact a Certified Financial Fiduciary before trying anything that is mentioned in this video. I prefer a Fiduciary financial advisor that charges an hourly fee as opposed to an ongoing fee based on a % of your portfolio. Always remember that incentives determine the type of advice they give you so one that charges an hourly fee is less likely to be problematic.
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Please how much does it cost to set up an IRA ACCOUNT
I have a Roth IRA and ive maxed it out every year. Its the secret to getting rich and retiring. I cant believe more people dont use it.. I have met so many colleagues who have never heard of a Roth or dont have a retirement account
Wow 😮
Isn’t that sad): I only learned about this from getting into trading in stock market. In school they only teach how to become in debt for college.
Because how do you pick the stocks
You can refer them to me😃
Thank god this video came out, I have exactly $542 to invest in an IRA
You too ?
Being 27, this was super helpful. Thank you Jarrad!
I’m 27 too bro
Word from a fat, old, bald guy who is a millionaire by investing in a 401K account. My opinion is to invest 100% in a fund that matches the S&P500. Don’t try to time the market by moving funds out of or into the stock market based on the ups and downs of the market. Moving your investments almost never works. Good luck !
R u millionaire yet
@@cupidok2768 close to it
HSA and Roth!! Hedge against high taxes in the future!
Oh yea! Best 2 investment accounts most people should have!
Can you give a little more information on a good HSA and how to grow it?
Congrats on 100K! 🥳 Yay for Roth IRA’s!
I'm annoyed at myself for not opening a Roth IRA before this year. I'm 49 and just opened one. I have substantial 401K and IRA but for whatever reason didn't do a Roth.
I plan to work for at least 10 to 12 more years, so I'm going to try to max it out every year until then. I may also do some conversions at some point.
VTI or VOO 100% max contributions for 25-30 years and you will have $1+ Million
million
It's just this simple 👍🏻
@@JarradMorrow stay the course as Jack Bogle would say but most people are stupid.
What’s a million in 25-30 years worth though?
@@mikeskordynski about 5 bucks.
@@mikeskordynski Depends on inflation but it could drop to as low as ~300k today. But hey, thats still more than if you hadn't invested.
Love you dude! So excited I got my Roth going this year. I did want to let you know, that M1 Finance (while great interface) there are some issues I have had.. For example, trying to withdraw my funds, has been a nightmare. They just are not doing it. I opened a account, funded it with $3k, then the next day decided I wanted to stick with my TD account. So, I went to withdraw my funds, and that was TWO WEEKS ago! Still nothing. Reaching them is impossible and a google search found that I am not alone in them having issues paying people! Fingers crossed this gets resolved. Def. would not recommend anything platform that operates like that.
I’ve had the opposite experience with their customer service so it’s always good to hear a different one. Thanks for sharing 👍🏻
@@JarradMorrow Thanks Jarrad! Just an update, they did finally transfer my funds back without issue. It took apx. 18-days from start to end vs. the 3-5 they quoted. The automated bot was in fact helpful, so I agree with you. All in all, it was just a panic situation that in the end was fine. So, I guess no harm done, lol. But, I can see some people not liking that and the feeling that you cant pick up a phone and call may worry some. Love all your videos! Have a wonderful holiday !
Thank you for all of your very thoughtful and informative content! I want to add that Fidelity also has an automatic contribution and investment feature so your contributions can be directed to mutual funds (not ETF or stocks) based on your predetermine %.
Hi. Can you please help me. I mean I’m new😩. I just started contributing but don’t know how to to invest.
@@lucyhonore9050 Start with what your goals are.
@@lucyhonore9050 Lucy, the internet is a goldmine if information. Start reading as much as possible and learn as much as you can. No one is going to tell you how to invest, it is completely up to you depending on your goals 🥅
A million dollars will still be alot of money 37 years from now.
If you're able to do so, do it!
Invest in a Roth IRA.
I wish I started sooner.
Great advice. Thanks for sharing!
I just learned about rorh IRA. Thanks for the info.
Any time!
1 million will not be anywhere close enough to retire in 37 years. Save accordingly.
Facts 💯💯🤑🤑🤑!!! We’re going to need a whole lotta money for sure. More like 15 mil or more seeing how cost of living keeps rising steadily 😏😏.
It is if you retire like a homeless person.
Agreed but it’s better to have a Roth than to not have one regardless lol but hey the 80k ppl watching this will win 😤
Exactly. Max out your Roth IRA then invest more in the market with ETFs and REITs. Let your money grow more.
Yet most people wont even have near 100k to retire so it's better than nothing
Heeeyy Jarrad! This is one the best explanations for a Roth IRA. I NEED TO EXECUTE! TY for the playlist!
Glad it was helpful!
Love your videos Jarrad! Any chance you could do one on coverdell education savings accounts (ESA)? Eligibility limits, what happens if you over-contribute, how to leverage the funds for ed expenses, tax implications if unqualified withdrawal etc…keep it up!!
Old school clip got me 😂😂😂
Same 😂. I couldn't stop laughing every time I played it during the editing process
1 million is peanuts.
Shoot for $5M minimum, especially if you’re retiring 10+ years from now.
Great video and information again!
Appreciate it!
I have M1 Finance since 7/31/2017, funded my Roth IRA and try to contribute the max every year. As of today +13,502.17 in gains and 24,334.21 in contributions, not too bad. I switched all my funds to 1, JEPI. Love the monthly dividends and don't have to be stressing over market movements.
Very informative and helpful!
Nice! Thanks!
Etrade and Fidelity have great Roth IRAs.
Thanks for sharing!
Thank you I’m on ETrade I’m gonna check it out I already have two trading accounts
Great info and great beard!
Appreciate it x2!
Thank you I learn lot from you I did not know I can invest in Roth IRA and 401k at same time
If you retire tomorrow, they are saying you need $1.7 million. Imagine what that will be in a few decades. Probably a strong axe, a gun with a bunch of ammo, and a way to stay alive in the post apocalypse world.
I can only do $500 per month, but let’s see..I’m almost close to finish my car payment this july..I will start putting money on my Roth IRA
Anything is better than nothing so $500 per month sounds great to me
DINKS with decent income in california get absolutely trashed in this game..228k combined AGI per year is pretty normal; and with 401k limits are only 22k per person; you either have to do a back door Roth or just invest on your own..Mo Money Mo Problems
Hi Jarrod, your video is very informative. I’ve learned a lot from it. May I ask is Apple and Tesla a good investment in our Roth IRA?
Do some people like to invest into some solid higher paying dividend stocks in there Roth to help fund the growth of the stocks they have in there. Let’s say put 2k into jepi which pays normally 8-12% dividen and don’t turn on drip but allow the money to be invested into vanguard etfs which are in the account.
it always nice to have some variety, even just a small percentage towards higher dividend stocks......personally i dont contribute to an IRA as i contribute to my employer's 401k for both transitional and roth, but on the side i put a little into a dividend specific portfolio for stocks that tend to pay a higher dividend yield along with established companies that have increased their dividends every year......thats just me though.
Nice video! Good info, side note is that a tasc shirt? There awesome
Thanks! Yep! I just found the brand a few months ago and love love love their shirts. All of the shirts I've been rocking with for the past 8 years are starting to need to be replaced so this is the new brand I'm going with.
very helpful !
Glad it was helpful!
That support Molly was genius😁Helll yea we wanna support Molly! 😂
👍🏻
Great Information!!
Glad it was helpful!
Firstly, thank you so much for this video it is right on time.
Secondly, Is there a benefit to depositing 500+ dollars every month, as opposed to skipping some months and depositing larger lump sums other months, still totaling the maximum allowed at the end of each year?
By "depositing" I'm assuming you're going to be investing the money right away. I'm also assuming you're a long term buy and hold investor in traditional index funds or index fund based ETFs. The only benefit by depositing $500 every month is that your money will get invested sooner which is always better (from a long term investing perspective). If it's not possible to be consistent with that due to something that has to due with your income/expenses then you're fine doing a little bit a few months out of the year and larger amounts at other points of the year. Don't overthink it too much and just get your money in there and working for you.
If you're someone who is asking from the angle of an individual stock investor or specialty ETF investor then anything I just said goes out the window and I don't have an answer for you because there's a lot more info that's needed 😂
@@JarradMorrow Thank you so much for your reply and yeah, looking for long term, well established index funds and the like.
Thanks again, and happy holidays
Invest consistently weekly or monthly and avoid jumping around. Why? When you bounce around you might end up missing out on market downturns/discounts.
If you invest consistently you capture the ups/downs and net better returns longterm.
Time in the market is better than trying to time the market.
Brandon it is better to spread out your investments because on average you will end up with more shares than if you were to deposit a lump sum once a year
I have a Roth IRA but only $400ish goes in per month
I have a Roth IRA and just put 3 grand into it I’m gonna be budgeting untill I have 6 grand in my Ira and then I’ll start saving my money so come January 1st I’ll just put another 6k into it
In my Ira I have S&P 500. Reality incom Apple nvida And Gladstone all dividends are reinvested.
Thanks Jarrad I’m going to make one today
How about the Roth 401k ? The annual contribution limit is way higher and able to grow it to a million a heck of a lot faster.
The investment options in a Roth 401k are very limited. You have to trust the company controlling your funds and hope the option you pick doesn't tank. In a Roth IRA you can invest in anything you want (to an extent).
Not everyone has access to that though, but if you do then sure
Love it. And you’re right, you can effectively contribute more
If your job allows that you can take advantage of it in which it can go hand to hand with your 401k since the money you put in your 401k is tax deferred but the money you contribute to your Roth 401k is basically tax free when it comes time to take the money out for retirement. If your job does employee match take advantage of that as well for your 401k im not sure for a Roth 401k.
Thank you great video tons of info will be rewatching this again. I'm sure we can make more than 7% with leveraged etfs but always safe to assume small returns. Can you please do a video on how we can pay as little taxes as we can on our investments also a video talking about infinite banking? Maybe you already have them idk. Thank you for your time. Ps funny seeing Molly giving you dabs 🤣
I swing trade in mine a lot cause there’s no fines
👍🏻
I have $20k in the market, split between mostly Roth, some SEP and some crummy stocks. Should I convert the SEP into Roth, and then follow your two ETF portfolio strategy? I'm 42, self employed, income is up and down all the time. Haven't contributed any in a while but need to..
How to do this in the current economy for the average lower class American making less than 40k a year with prices soaring for everything and rent and or a mortgage? Starting at age 40
Getting and emergency fund set aside then increasing your income sounds like it needs to be the main focus.
I hate to say it, but with most of us, we won’t be able till we retire until we are 6 feet in the ground
What are some things you're doing to try to change that?
Would M1 Finance suggest what’s good to invest in?
If i open a roth ira should can i rollover my 401k to the roth ira account or have them serperste
Yes you can, but it doesn't always make sense. Here's a video where I cover rolling over a 401k: ua-cam.com/video/x-j_ZHzbAyg/v-deo.html
Hey, Jarrad! Great video! Question about your statement about taxes on back door roths at 3:33. If I’ve opened the Traditional IRA with already taxed dollars, do not invest, and convert immediately, is there ADDITIONAL tax I’d be on the hook for?
Thanks for all the fantastic content!
Call a CPA
My husband and I did exactly that through VanGuard, every year, for almost a decade. A top CPA does our taxes. We were not required to pay additional tax since the Traditional IRAs were funded with after-tax dollars. We let it sit in the money market fund (uninvested) and moved into our ROTHs within a week or so. Hope that helps.
Hello,
I’m a little confused here and wondering if someone would be able to help me 😅. So I opened a Roth IRA account with chase and my thought was that by simply putting in money weekly and leaving it alone would grow. I understand that I need to max out every year (6500). Do I need to invest or buy (not sure what terminology to use) etfs, stocks, etc. after I have maxed out or once I have money into the ira, (I’m guessing enough to buy etfs or stocks) ?
If so what etfs or stocks should I consider buying for long term investment. Now, after buying them they would eventually be reflected back into the ira account and thus adding to my maxed out amount for the year?
Thank you!
so i contribute to my employer's 401k with a split between traditional and roth, aside from it going through my employer is there any real difference between a roth 401k and roth IRA? i dont contribute to an IRA outside of my 401K, but i did start throwing a little into a dividends portfolio that i created myself which i have bumped up to about $300/month contribution. pretty modest contribution but i am hoping since it is strictly dividends focused that hopefully it will start to snowball a bit quicker, i am 37 yo so trying to get as much invested as i can right now.
Generally you to want to contribute $6,000 to 2022 Roth IRA & $6,500 to 2023 Roth IRA before considering taxable brokerage account.
Do I need to make trade actively in ROTH to earn or I just need to put money on it and I should be fine?
VOO pays out 1% dividends every quarter, just reinvest the dividends
Who is saying not to reinvest the dividends?
@@JarradMorrow I was adding on to your point about the tax free benefits in the Roth IRA. Giving a example
👍🏻
So all i have to do is put a certain amount of money in the account a month and its gonna grow by itself
except inflation will make that chump change by the time you can touch it and that's assuming the US dollar maintains it's dominance
My wife has an old 401k and 403b from a previous employer, about 9k in total. We need to roll it over but would like to put the money into a Roth IRA...can I do that but just expect to pay the taxes on it for converting? Would that be my tax bracket percentage times the 9k to figure out? Sorry learning all this stuff as fast as I can.
Married Filing Jointly < $90k = 12% Federal Tax Bracket; $90k - $190k = 22% FTB; $190k - $365k = 24% FTB. If $9k keeps you in 12% FTB, you'll owe [$9k * 0.12 =] $1,080 Federal tax. You owe State tax too. If you're in relatively high tax bracket you could just roll $9k to $9k traditional IRA and then contribute $6,500 for his Roth IRA and $6,500 for her Roth IRA. This will provide tax diversification.
Your honest opinion would help me out should I keep putting in 500 a month or just put 6500 in every year in April are there any pros or cons thanks again
@@bygrisharaven4805 well since you can’t draw till 60 I’d say long term in only 22
Monthly
If you can afford to contribute $6,500 all at once you can do that in January as there is no reason to wait until April.
@@alrocky gains and losses can be a bit lumpy. Monthly would smooth it out but not a massive difference. I don’t think anyway.
yesss the old school reference hahahaha
I thought it was better go traditional, as your tax rate in retirement likely wont be as high as it is during working years. Is that not the case? Or is it that with the compound interest over X years, it will more than offset the higher tax rate in the present if you contribute to a Roth?
Do you believe you can have too much retirement? I was my wife and I were contributing 10% each to our own 401k plus we have a few IRAs. But based on 7% return and retiring at 65 between the two of us we'd have 10 million. I feel like that's too much so I'm looking for ways to keep more money now but not have to pay high taxes. I make $200k and my wife is $70k both W2 employees. It seems like just HSA or investment accounts.
Where do you work
You can retire early 🤣
With your salaries consider _default_ contribution as $22,500 *_traditional_* 401(k) each and $6,500 *_back door_* Roth IRA each. Have you contributed $6,000 * 2 to your 2022 Roth IRAs?
Just a flippant remark, but prices seldom go down. If you're struggling to get by or just want a better standard of living now, then reduce it. If your confortable now, it's never a bad thing to have more money than you need. No one knows what the future will bring. Another thing is, by the time you hit age of 40, 45, 50, or so, are you gonna still be able to face going to that job everyday? Might you be able to find something you'd rather be doing? If I were in your shoes, I think I'd retire with a few million and spend my time enjoying life.
P.S. I wish I had your problem. I'm 55 and I'm already soooo ready to retire but can't.
Lucky bastard
Should I just start a Traditional IRA if I know I will make the threshold in about 2 years?
Does the 6000-6500 initial contribution include rollovers from employers/previous employers? If someone did a 20k rollover from a job would that be heavy tax penalties???
I started my Roth at 64 yrs old, when can I withdraw tax free?
Is there a maximum amount of money that you can open a Roth IRA with?
As long as you don't exceed the yearly contribution limit ($7k for 2024) then you're good.
Can I contribute to my Roth and HSA for 2022 IN 2023 AFTER I filed taxes for 2022?
Great question that I probably should have addressed in the video. Yes you can as long as it's done before the tax deadline AND it's done with money that you earned in 2022. When you file your taxes for 2022 there's usually a question on the form that goes something like "have you made or do you plan to make a contribution to your Roth IRA for XXXX year (2022 in your example)?"
@@JarradMorrow how strict is this? Ill make up numbers for an example. Lets say I have $100k in a savings account but I get a paycheck in january that is direct deposit into a checking account. Do i need to swap money from my savings account for it to not "count" as 2023 money?
What company should I go with.
Betterment charges 0.25% but have Tax Loss Harvesting & asset allocation.
I invested with Betterment before I heard about Vanguard...
(They invest in vanguard ETFs, but they make it easy to set it & forget it. They tell them my time Horizon, they recommend a stock/bond ratio, and then they'll adjust it to less stocks more bonds as you get closer to your target rate).
Betterment is my top choice for Roboadvisors if someone wants to take a more hands off approach. Self managed is of course better and cheaper, but if someone wants a little bit of help then Betterment is great. Thanks for sharing!
I'm a New Fidelity IRA user, and I'll most likely be switching to M1 or robinhood. Fidelity's interface is trash, seems like it takes 10 minutes and a few UA-cam videos just to figure out how to navigate the website😂. Also there are auto buys ONLY for Fidelity Mutual funds. The biggest reason I picked an established platform is because of customer support and insurance reasons, but most of these newer online brokerages have the same insurance coverages.
What's better, M1,Robinhood, or Traditional Company? Leave a comment!
Is there a minimum you have to contribute every month? And do you have to contribute every month?
You can invest as much or as little as you want every month as long as you don't contribute more than the maximum amount allowed during the 15 month time period mentioned in the video. If you're not able to do the whole amount at once then just try to stay consistent with putting money in on a regular basis.
I am getting serious Bradley Cooper vibes here...
😂 you’re not the first one that has said that. I get Jake Gyllenhaal more than BC, though
can I max out my works 401k and max out a roth ira? or is $6500 the combined max?
Yes you can. These are two different accounts with two different contribution limits so you’re good
No one ever mentions my choice of IRA, Marcus by Goldman Sachs. What’s up with that?
What would you recommend if we are a couple with two IRAs? Should we avoid overlapping?
Not sure if I understand the question completely but my wife and I each have a Roth that we max out and it’s all in the same low cost index fund.
You can have near identical asset allocation or just treat you combined IRAs as one large portfolio.
Whoo hoo! 100k subbies!
Funny thing is I have exactly 542 in my old roth
If your under the income limit for a Roth IRA can you still contribute $6500 to each Roth and Traditional to do a rollover so you can essentially contribute $13,000 Roth per year? My work offers Roth 401k but the investments options aren’t great so looking for an alternative.
Q1 No. Contribution to traditional IRA + Roth IRA may not exceed $6,500 for the year.
Can I do short trade in Roth IRA what would be the penalty
You can do any kind of trade within a Roth IRA as long as the investment platform you're using supports it. If you don't withdraw money from the account based on the guidelines then there's no penalty from an IRS perspective.
If I am older than 59.5 is the good idea to open Roth IRA ??
What if I die before then what should my family do
Whichever investing platform you use should allow you to add beneficiaries to your account so they know where the money goes. I'd also suggest getting a will in place if you haven't done that yet.
Thanks
What is the logic making it so that I am not permitted to contribute to a Roth IRA? I make over the arbitrary limit. Shouldn’t the government want me to pay my high taxes before investing in an IRA?
You can contribute to a Roth IRA through a backdoor roth if you're above the income limit. I mentioned this in the video.
@@JarradMorrow Right, you can. But why? What was the reason it was set up this way? I mentioned that I wanted to know why in my comment.
Can you invest in two Roths? One for me and one for my wife if she is a stay at home mom?
Yes you can its called a spousal IRA
Yes
How does one earmark a contribution to be for the previous calendar year (prior to tax filing deadline) as opposed to being for the current year? For my SEP IRA, I contributed throughout 2022 but I want to make sure to maximize that contribution once I know exactly what the max for me was (I do not make enough for the global allowed max to apply). It is now 2023 and I was thinking of, as in 2022, contributing to it on an ongoing basis for 2023 as I earn applicable money. But distinguishing between "this contribution was made in 2023 for 2022" and "this contribution was made in 2023 for 2023" is challenging because I do not know how to tell the government which contribution is which. (The paperwork and organization demanded of me is a different matter which I also would need to address).
In Fidelity you can set which year you'd like to contribute to and they keep track of it for you. I'd assume it'd be the same for other brokerages but I'm not sure
@@mcmario67: Hmmm, I will have to look into that, but thank you! :)
Can anyone simply explain what MAGI is and why there is an income limit to Roth IRAs?
Roths are tax shelters of sorts. Government wants taxes today and in future. If you can’t put money in either it forces you to open a brokerage account which you will pay taxes on a yearly basis on gains. Albeit may be at a lower rate but gets the moneys into an account where they can get taxes from individuals on a more regular basis.
For MAGI use google.
Hello! Great video! So I have a question. How are dividends handled within a Roth IRA? Is it counted towards the $6500 contributions amount when it is automatically reinvested or the investment growth? Thanks!
Dividends are not counted towards the 6500 deposit limit
The $6,500 is the principle you contribute on your end. If you make money through dividends, it gets reinvested automatically on the back end.
No they don't, so you can get your divi's tax free.
@@GUNNER67akaKelt quite literally what I said / implied. I didn’t know inferring was that difficult.
@@tylerwbrown86 Huh??? I apparently missed some of this conversation. I was replying to the OP, not you.
Success.fratelo.
👍🏻
What do you think would be better for a 21 year old IUL or Roth IRA. I’m looking to retire early if that helps in anyway.
Any kind of Universal Life Insurance is a horrible idea for 99% of people. I would personally avoid them at all costs because they're loaded with hidden fees that can be avoided by just investing the money through other investment accounts.
What is early retirement? You're waiting till 59 1/2 for withdrawals?
Possible to convert Regular IRA to Roth IRA via conversions?
Yes, but you will pay taxes on the pre tax money you are converting.
Except, what happens if we only get $500/month?
You don’t have to max it out every year if you can’t afford it. Do your best to increase contributions over time.
@@JarradMorrow and if your spouse makes enough can't he help pay the rest ? (as long as you file joint tax return) or am I understanding that part wrong?
I just opened a ROTH IRA. Do I contribute to FSKAX FTIHX ans FXNAX?
Fidelity® Total Market Index FSKAX should likely constitute the majority of your portfolio.
Is it worth it at all to consider switching IRA providers? I started with Fidelity just recently but their automatic investing is pretty abysmal.
I just starting creating an account with fidelity and the way you explain the difference of those 4 brokerage n which one to invest in and what not. Question. Can I invest or create Roth IRA account with 2 brokerage account ? Lmk! Please I’m still new n willingly to learn more. Thanks
Great question. Yes you can as long as you don’t exceed the maximum contribution limit for the year across all Roth IRAs
Please tell us what you have in your Roth IRA account.
ua-cam.com/video/HF3OIEYHKro/v-deo.html
@@JarradMorrow Thank you Sir, that was very helpful.
What happens to the extra 4 dollars at the end of the year that's over the contribution limit?
What extra $4?
@@JarradMorrow 6500/12= 541.66666 so 542 puts you over the contribution limit by 3.96 or am I over thinking this?
Ah, I see what you're saying. Yes you're correct that it'll put you over the limit by a few dollars. I just rounded up to make the title easier to read so don't go over the $6,500 per year.
You’ll have to deal with a bunch of paperwork. Do 540 and forget it till limit is switched in the future
I dont have the type of job that would EVER give a 401k (I'm a waiter/bartender in high end restaurants) but I make close to a quarter million a year, I know a few chain restaurants have IRAs and paid time off and stuff but I probably would make way less working at one of those so I either have to switch careers, which I wouldn't wanna do unless i found something to be an entrepreneur with on a huge level or maybe go into finance but being in my late 20s I'm probably a bit late to start working towards that type of certifications and stuff while still paying bills, or just use an IRA. I use Betterment and contribute I believe $130 a week. But I can't have 2 right?
You cant have two IRAs...if you do, contribution limits is still 6500 total not each one.
Just open a Fidelity Roth IRA...its free. Once you do, work up to saving the max amount a year into it....once money in the IRA, purchase stocks and good etfs....like VOO, SCHD etc.
Making a quarter mill as bartender? Haha good story troll
Question. When you do Back Door ROTH Conversion, you are taxed twice? Taxed contributing to traditional IRA and then taxed upon conversion?
Traditional IRAs are funded with pre-tax money, so no.
You contribute after tax dollars to the IRA and then immediately initiate the transfer. So technically there is no growth in the capital. So there is no tax. Having said that, be careful of the pro rata IRS rule. If you have other existing IRA such as a traditional or Rollover or SEP, you may be liable to additional tax bill because IRS considers all IRAs as one large pool.
@ 62 Am I to old to consider a Roth ?
i have a roth IRA but heard grant cardone saying having a roth IRA is just leading to wall st. just taking the money or something like that is that true? also would you recommend investing into S&P 500?
Grant cardone is a dork. Invest often into a Roth ira... buy VOO and you'll be a millionaire in 30 years
MAGI eliminates my wife and I. The government will always find a was to dazzle us with smoke and mirrors.
Backdoor Roth is always an option if it make sense for you
M1 roth ira vs robinhood roth ira?
M1 over Robinhood Roth. They've gamified their app so much that holding an IRA through them is a disaster waiting to happen. I'm fine with the app for your "fun" money, but no way in hell would I ever put my long term investment money on Robinhood. Behaviorally, it's a terrible idea for most people (even with the 1% match).
How is vanguard ROTH? And do you recommend only focusing on ETFs or mixing in aggressive stock?
You should be able to open a Roth account through Vanguard to see if you like the platform. I only like ETF based index funds or traditional index funds. There's a 99.99999% chance you'll never see me buying individual stocks
How does a 19yr old self employed person open an IRA.
The same way as everyone else. There's no difference. As long as you have earned income that's taxed then you're good to go.
@@JarradMorrow thank you. Do you recommend traditional or Roth IRA
The general thought process is that when you're younger and your income is lower a Roth IRA is a better option. The idea behind this has to do with the fact that a lower income means you're paying a lower tax rate. As you get older your income will most likely increase so if you contribute to a Roth IRA or do a Backdoor Roth then you're going to be paying more in taxes since you're going to be in a higher tax bracket.
Some higher income earners prefer to contribute to their traditional IRA to lower their taxable income, but that's more of an advanced topic that you might not have to worry about right now.
Even though I'm in a higher tax bracket I go about this a little differently based on my personal preference/situation. I think taxes are going to increase in the future so I contribute to a Roth IRA whenever I have the chance. I also already have a lot of money in pre-tax investments so I want to give myself both pre-tax and post-tax options when I eventually retire and start withdrawing money. This is an advanced strategy when it comes to being able to have more control over the taxes I'll pay in retirement. For you, don't worry about this sort of thing right now. Just get your money in a Roth IRA (as long as it makes sense income/tax wise) and learn the more advanced stuff as time goes on.
@@JarradMorrow thank you!!! 🙏🏼 this is the best advice I’ve gotten. I really appreciate you taking the time to answer in such detail. This makes you a real dude that cares and even a more legit person on this platform 💯
What if you retire at 55? It sucks you can withdraw without penalty at a younger age.
You can withdraw the contributions you've made to the account up until that point
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