Today, we go over what you need to know BEFORE opening a Roth Individual retirement account (IRA). We’ll go over benefits, limitations, how it compares to other IRAs and MORE!
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A few notes: Roth IRAs are a great way to save for retirement, but it is important to choose low-fee investments. Index funds and ETFs are two popular options, as they are passively managed and have low expense ratios. Fractional share trading platforms can also be a good option for investors on a budget. When choosing investments for your Roth IRA, it is important to consider your risk tolerance, time horizon, and investment goals. You should also diversify your investments to reduce your risk.

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Times:
0:00 Start here
0:54 Today’s objectives
2:25 Key Benefits of a Roth IRA
8:09 Key Tax Advantages
10:48 Roth IRA Limits (Not EVERYONE Qualifies)
13:37 IRA Loophole (Backdoor and MEGA-Backdoor IRA)
16:42 Pros and Cons of a Roth IRA
17:51 Roth IRA Versus 401(K)
23:02 Roth IRA Versus Traditional IRA
26:00 How to Maximize Roth IRA Benefits
29:14 When NOT to Open a Roth IRA
32:28 BEFORE Opening a Roth IRA…
37:19 How to Open a Roth IRA (Simple steps)
39:54 Roth Summary!

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My name is Alex and in 2018, my wife and I found ourselves DEEP in 215,000 USD of BAD debt including car loans, personal loans, student loans, credit cards and more.

We felt like we were falling behind, scared, stuck, frustrated, and could not move on with our lives to start our family.

Most importantly we did not live in peace, as the debt was holding us back and keeping us up at night.

We decided that enough was enough; we got on a plan and we hustled hard.

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I know how painful it is to feel stuck, burdened by debt, and also what it does to us psychologically, affecting our confidence and self esteem.

That’s why I am now sharing the mindset (most important), strategies, and lessons we learned to help professionals CRUSH DEBT, become confident, take control of their money, and build the life they deserve.

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Sources used:
Roth IRA Contribution Limits for 2023:

Traditional IRA Contribution Limits for 2023:

2023 Roth IRA Contribution Limits:

2023 Tax-Year IRA Contribution and Income Limits:

2022-2023 Roth IRA Contribution Limits:

DISCLAIMER:
I am not a financial advisor. The ideas presented in this video are for entertainment purposes only. You (and only you) are responsible for the financial decisions that you make….(read more)

LEARN MORE ABOUT: IRA Accounts

INVESTING IN A GOLD IRA: Gold IRA Account

INVESTING IN A SILVER IRA: Silver IRA Account

REVEALED: Best Gold Backed IRA

Roth IRA: Beginner Guide to Save BIG (Avoid Penalties and Mistakes)

Saving for retirement is a crucial financial goal, and a Roth IRA can be an excellent tool to help you achieve it. A Roth IRA is a type of individual retirement account that offers several tax advantages, including tax-free withdrawals in retirement. However, to maximize the benefits of a Roth IRA and avoid potential penalties and mistakes, it’s important to understand how it works and the rules that govern it.

What is a Roth IRA?

A Roth IRA is a retirement savings account that allows you to contribute after-tax income, and the earnings on your contributions can grow tax-free. One of the key benefits of a Roth IRA is that qualified withdrawals in retirement are tax-free, unlike traditional IRAs or 401(k) accounts, where withdrawals are taxed as ordinary income.

Contribution Limits and Eligibility

For 2021, the annual contribution limit for a Roth IRA is $6,000 for individuals under the age of 50 and $7,000 for those age 50 and older. It’s worth noting that there are income limits for contributing to a Roth IRA. For 2021, single filers with a modified adjusted gross income (MAGI) of $125,000 or less and married couples filing jointly with a MAGI of $198,000 or less can make the full contribution. However, the ability to contribute to a Roth IRA starts to phase out for single filers with a MAGI between $125,000 and $140,000, and for married couples filing jointly with a MAGI between $198,000 and $208,000.

Investment Options

Once you have opened a Roth IRA, you’ll need to decide how to invest the funds within the account. Most financial institutions offer a variety of investment options for Roth IRAs, including stocks, bonds, mutual funds, and exchange-traded funds (ETFs). It’s important to consider your risk tolerance, time horizon, and investment goals when choosing the appropriate investments for your Roth IRA.

Avoiding Penalties and Mistakes

To avoid potential penalties and mistakes when it comes to your Roth IRA, it’s essential to be aware of the following rules:

1. Early Withdrawals: While Roth IRA contributions can be withdrawn at any time without penalty, the earnings on those contributions can only be withdrawn tax-free and penalty-free once you reach age 59½ and have had the account for at least five years. Otherwise, early withdrawals of earnings may be subject to taxes and a 10% penalty.

2. Required Minimum Distributions (RMDs): Unlike traditional IRAs, Roth IRAs do not have RMDs during the account owner’s lifetime. This means you are not required to take a minimum distribution once you reach a certain age, allowing your funds to continue growing tax-free.

3. Qualified vs. Non-Qualified Withdrawals: It’s important to understand the difference between qualified and non-qualified withdrawals from a Roth IRA. Qualified withdrawals, which are tax-free and penalty-free, occur once you reach age 59½ and have had the account for at least five years. Non-qualified withdrawals, on the other hand, may be subject to taxes and penalties.

4. Contribution Limits: Make sure you are aware of the annual contribution limits for Roth IRAs and avoid contributing more than the allowable amount for the tax year.

In conclusion, a Roth IRA can be a powerful tool for saving for retirement and offers several tax advantages. By understanding the rules and potential pitfalls, you can maximize the benefits of a Roth IRA and avoid penalties and mistakes. If you’re unsure about how to best utilize a Roth IRA for your retirement savings, consider consulting with a financial advisor to help you make informed decisions.