A traditional IRA is an individual retirement arrangement. It’s basically a tax-advantaged personal savings plan where contributions can be tax-deductible. Traditional IRAs are pre-tax contributions with immediate tax benefits, reducing the amount of income you pay taxes on right now. The money you put in is tax-free. In this video, we’ll talk about the traditional IRA, and why you might invest in a traditional IRA if you expect to make less money in the future than you do now. In a way, you’d be deferring your taxes on the IRA gains to some time in the future.

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Video Editing by Justin Nelson
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Today, we want to focus on Traditional. Is the Traditional IRA right for you?
In a Traditional IRA, you control the investment, not your work, not your employer, not your financial guy (who’s not gonna get you as good of returns), and it’s not in a mutual fund that will be killing you with fees. You can invest the money any way you see fit, and like all the greatest investors over the past century, if you simply buy a low-cost index fund or an ETF, like SPY or VOO, you’ll get an average return of just under 10% for the rest of your life!

An advantage to starting a traditional IRA is that anyone with earned income is eligible to contribute, EVEN if you’re making a ton of money. However, if you’re a stay-at-home spouse or parent, FEAR NOT! You can actually contribute into a spousal IRA, which has the same benefits. And the same thing goes for the age restrictions: there are none; invest when you’re a teenager all the way through your 90s.
Now, there are some restrictions we should probably let you know about:

The maximum contribution limit is $6000 per person and $7000 if you’re 50 years old or older. The goal should be to try and get in that 500 dollars a month. It’s a bit challenging and it takes discipline, but in the end, you can completely transform your retirement savings.
Go to Fidelity, go to Schwab, go to Vanguard, and simply open a new account. Put in your social security number, and you can link it with a bank account and send an automatic deposit like all those other payments and subscriptions you have. Buying into a low-cost index fund takes all of ten seconds. And, oh yeah, it’s completely free.
Once I reach 59 and a half years old AND I’ve had a Traditional IRA for at least 5 years prior to that, I can start taking withdrawals to live on. This money will be taxed as current income, Meaning, say you retire, you don’t want to work anymore, and you start pulling withdrawals from your traditional IRA, you’ll still get taxed as if you were still working and that was your job. So, if you pull out $75,000 grand a year to live on, you’d be paying taxes just like you were working a $75,000 a year job.

There are also mandatory distributions you must take after the age of 72. Remember, Uncle Sam always wants a piece of the action. So, essentially, they force you to take the money out, so they can get part of the money in taxes.

According to the IRS, “Traditional IRAs are really great for individuals who expect to be in the same tax bracket, or even a lower tax bracket when he or she starts taking withdrawals later in life.” Maybe when I retire, I don’t need that much money and I certainly don’t want to pay a bunch of taxes, so, in essence, I can control my income level, AND my tax burden, by mandating my traditional IRA withdrawals.
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0:00 What is a traditional IRA?
0:28 Why you should invest in a traditional IRA
0:43 Traditional IRA vs Roth IRA
1:03 Is the traditional IRA right for you?
2:08 Why you should invest now
2:26 Traditional IRA advantages
3:40 Calculating your IRA retirement savings
4:35 Opening a traditional IRA
5:27 Withdrawing money from a traditional IRA
7:19 Do I invest in a traditional IRA?…(read more)

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Are you looking to become a millionaire? Investing in a traditional IRA is one of the best ways to do it. A traditional IRA is a type of retirement account that allows you to save money on a pre-tax basis. This means that the money you contribute to your IRA is not taxed until you withdraw it. This can help you save money on taxes now and grow your wealth over time.

In order to become a millionaire with a traditional IRA, you need to understand the basics of investing. First, you need to decide how much money you want to contribute to your IRA each year. The maximum amount you can contribute to a traditional IRA each year is $6,000, or $7,000 if you are age 50 or older. Once you have decided how much you want to contribute, you need to decide where to invest your money.

There are many different types of investments you can make with a traditional IRA, including stocks, bonds, mutual funds, and ETFs. It is important to do your research and understand the risks associated with each type of investment before you commit to any one of them.

Once you have decided which investments to make, you need to decide how much to invest in each one. A good rule of thumb is to diversify your investments so that you don’t have all of your money in one place. This will help reduce your risk and give you the best chance of becoming a millionaire.

Finally, you need to be patient and disciplined with your investing. Becoming a millionaire with a traditional IRA takes time and effort, but it is possible. As long as you are consistent with your contributions and make smart investment decisions, you can reach your goal of becoming a millionaire.

Becoming a millionaire with a traditional IRA is a great way to save for retirement and grow your wealth over time. It is important to understand the basics of investing and make smart decisions in order to reach your goal. With patience and discipline, you can become a millionaire with a traditional IRA.