Let’s talk about back door Roth IRA, what it is, how to get started, and things you should consider before making the move. If you take the front door, not everyone qualifies to contribute into a Roth Individual retirement account or Roth IRA. Apparently, there is a back door.

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401K vs Roth IRA How to Decide? Where to contribute? –
401K Explained. Keep your 401K or rollover into a Roth IRA account? –

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SCRIPT
• I want to talk about back door Roth IRA, what it is, how to get started, and things you should consider before making the move
• If you take the front door, not everyone qualifies to contribute into a Roth Individual retirement account or Roth IRA. Apparently, there is a back door. Let’s talk about it
• If you follow this channel, you know I am a big fan of Roth IRA. I have done a few videos on this topic. Links will fly on the screen and will be in the description
• Might be useful to watch those first and then come back to this video
• To quickly summarize, IRA is an individual retirement account, comes in two flavors – Traditional and Roth. Contribution limit is $6000 for 2019 and 2020.
• Traditional IRA is tax deferred. You will pay taxes when you retire and withdraw. Any increase in account value is taxed
• Roth IRA on the other hand is taxed upfront and will be tax free when you withdraw. You pay tax upfront when you make the contribution. Any growth in the account overtime is tax free
• And that makes Roth a no brainer to me.
• See over time stocks go up and offer an average yearly return of 7%. If you start early and max out your yearly Roth IRA contribution, your account will growth significantly over time
• And when you are ready to retire, you can withdraw money tax free because you’ve already paid taxes upfront
• Again, watch the other videos, if you need more information on IRA
• By the way, you still have time to contribute towards 2019. Since the deadline for filing taxes is pushed to July 15, you can contribute to IRA for 2019 until July 15
• So then, it makes sense for everyone to set money aside in a Roth, right? Right. The problem is not everyone is qualified.
• IRS has income restrictions. Simply put, if your income is higher than the threshold IRS has laid down, you cannot contribute to Roth
• Apparently, there is a Back Door. Some call it a tax loophole that allows everyone irrespective of their income to contribute into a Roth IRA. And it is legal
• I recently set this up for myself using M1Finance and wanted to share the steps I took to get this going.

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CHANNEL DESCRIPTION – On Think Finance, you will find investment ideas, money management tips, real estate strategies, retirement tips, and ways to generate passive incomes and wealth.

Hi everyone, my name is Raj and my goal is to share ideas, learn from others and in the process help each other. If stocks, retirement, real estate, money, and personal finance are areas that interest you, do consider subscribing.

DISCLAIMER – I am not a Financial Adviser or Tax Professional, the information provided is my personal opinion and should not be considered professional advice. Ideas discussed on the channel are actions I am personally taking to hit my financial aspirations and not professional advice. I’m not responsible for any monetary gain or loss that may occur following information on the channel….(read more)

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