I am 53 and retired at 50. 1 thing I did do to retire early was to get out of the 401K and IRA programs. Bought rental real-estate and I am now a Limited Partner in about 1500+ units from collaborative efforts in the fund my estate planner has me invested in. I do not work.
I only contribute 5% to get full company match, that’s it. The 401K plan is designed for you to work until you are about dead. Also, the government does not have their hands on it yet either.
My wife and I live off of our 401K. We don't work. I recommend highly to everyone to build your 401K or Roth IRA's as an alternate revenue stream in retirement to your Social Security. An observation on 401K's is when it gets over 300K it starts to accelerate. When you get over 500K it can really accelerate as the stock market grows.
I've stuck with ‘’Julianne Iwersen Niemann” for about 9 years now, and her performance has been consistently impressive. She’s quite known in her field, look her up.
I've stuck with ‘’Julianne Iwersen Niemann” for about 9 years now, and her performance has been consistently impressive. She’s quite known in her field, look her up.
I'm 54 and my wife and I are VERY worried about our future, gas and food prices rising daily. We have had our savings dwindle with the cost of living into the stratosphere, and we are finding it impossible to replace them. We can get by, but can't seem to get ahead. My condolences to anyone retiring in this crisis, 30 years nonstop just for a crooked system to take all you worked for.
@JacquelineTheresa The crazy part is that those advisors are probably outperforming the market and raising good returns but some are charging fees over fees that drain your portfolio. Is this the case with yours too?
This answers so many questions that i’ve had for awhile about this. Usually when you speak with professionals in the financial/banking world, they don’t make it easy to understand, as if they are reading from a book. Thanks for the video
came here to say this same thing. You can withdraw any or all contributions at any point for any reason, with ZERO penalties ( fees, charges, etc.). Not sure where that 5 year wait came from.
Means you’ll be tax at the moment that you make the deposit and in the future when you make a withdrawal you won’t be taxed anymore, that’s with a Roth IRA
But with a traditional IRA, in your case, you'd get taxed on that lower income. (as opposed to if you had a Roth IRA and already paid taxes on the money). I'm not arguing either way, but interested why you think traditional IRA is better for most people?
@@thewealthworkshop I’m not a tax expert, so let me know if I get anything wrong here. With traditional IRA you are only taxed on whatever you withdraw, right? Let’s say I make $20,000 a year on Social Security retirement money and then I withdraw $10,000 from my traditional IRA. That means I am at $30,000 income. The long-term capital gains tax rate for that income is 0%. Does that mean I don’t have to pay any tax on the $10,000 I withdrew for my traditional IRA?
Correct, since Roth IRA contributions are made with money you've already paid taxes on, you won't pay taxes on the money you withdraw from the account in retirement.
I don’t get it. At 4:15 you say there isn’t a limit on how much can be contributed to a Traditional IRA but later you say the limit is $6000 for both Roth and Traditional IRA. Please explain
Hey Raul! First, thanks for watching! The limit that I'm talking about at 4:15 is your income limit. So you can make as much money as you want and have the ability to put money into a Traditional IRA (up to the limit which is 7K for 2024), but if you make more income than 160K-ish (as of 2024) you will not be allowed to contribute to a Roth IRA at all.
If your incone tax braket is 32% rn, and your retirement income tax bracket is 22%, then a traditional IRA is better because you ultimately pay less to the man.
how? you are the only one who will decide weather you invest your money or not in the first place. if you think that way, you can start building your spaceship and then go to the other planet and in there you can make your own rules and laws.
Well, I for sure will never make an income of over 140k. So I know a traditional IRA is a safe bet. If you're in your early 20s, investing in IRA, and know you'll finish college and eventually make 200k salary then no.
Hmm, well traditional would mean you don't pay taxes on that money now, so it could lower tax burden? Hope you get it figured out. Thanks for watching!
Everyone is 100% sure will be in a higher or lower tax bracket 5, 10 or 15 years from now. Even in one year from now. Who invented this nonsense ponzi??? 🤣🤣🤣
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I am 53 and retired at 50. 1 thing I did do to retire early was to get out of the 401K and IRA programs. Bought rental real-estate and I am now a Limited Partner in about 1500+ units from collaborative efforts in the fund my estate planner has me invested in. I do not work.
I only contribute 5% to get full company match, that’s it. The 401K plan is designed for you to work until you are about dead. Also, the government does not have their hands on it yet either.
My wife and I live off of our 401K. We don't work. I recommend highly to everyone to build your 401K or Roth IRA's as an alternate revenue stream in retirement to your Social Security. An observation on 401K's is when it gets over 300K it starts to accelerate. When you get over 500K it can really accelerate as the stock market grows.
If I may ask, as in withdrew all of the money from the 401K and IRA programs? If so, what was your strategy behind that decision? Thank you.
I've stuck with ‘’Julianne Iwersen Niemann” for about 9 years now, and her performance has been consistently impressive. She’s quite known in her field, look her up.
I've stuck with ‘’Julianne Iwersen Niemann” for about 9 years now, and her performance has been consistently impressive. She’s quite known in her field, look her up.
I'm 54 and my wife and I are VERY worried about our future, gas and food prices rising daily. We have had our savings dwindle with the cost of living into the stratosphere, and we are finding it impossible to replace them. We can get by, but can't seem to get ahead. My condolences to anyone retiring in this crisis, 30 years nonstop just for a crooked system to take all you worked for.
@JacquelineTheresa That's actually quite impressive, I could use some Info on your FA, I am looking to make a change on my finances this year as well
@JacquelineTheresa The crazy part is that those advisors are probably outperforming the market and raising good returns but some are charging fees over fees that drain your portfolio. Is this the case with yours too?
@JacquelineTheresa I will give this a look, thanks a bunch for sharing.
One of the best explanations I’ve seen
Thanks for watching!
This answers so many questions that i’ve had for awhile about this. Usually when you speak with professionals in the financial/banking world, they don’t make it easy to understand, as if they are reading from a book. Thanks for the video
This answered so many questions I had, thank you!
Well explained
Thanks!
What if I'm in a low income bracket now and expect the same closer to retirement? Which account is the better option for this scenario?
Won't matter if trump wins, if not go roth
Good presentation. Very well explained
Thanks for watching!
thanks for the info
@ 2:30 There is *no 5 year wait* to withdraw Roth IRA *_contributions._*
I was surprised to hear that too
came here to say this same thing. You can withdraw any or all contributions at any point for any reason, with ZERO penalties (
fees, charges, etc.). Not sure where that 5 year wait came from.
yea that sounds more like the backdoor roth strategy
I like this video, well done Wealth Workshop. J. Carlton Collins, retired CPA
Thanks so much!
Who’s here from the video Mr. Villa is making us watch 🤣
Mr Villa sounds like a pretty cool person :)
@@thewealthworkshop he’s him chat
I hate Mr villa
@@nolanjohnson1209 woah that’s brazyyy dawg, Mr villa is himothy
Is it better to convert my 401k into a additional IRA or somehow put it into my already existing roth ira
Which choice Will you have more after taxes is the answer.
Most people pay less taxes in retirement but that doesn't mean you will
At 1:19 how you being taxed before contributing if you haven't even contributed???? It does make any sense!!!!
Means you’ll be tax at the moment that you make the deposit and in the future when you make a withdrawal you won’t be taxed anymore, that’s with a Roth IRA
How can I know in the future if tax bracket will be high or low. ?
Usually when you retire, you don’t make any money so your income will be lower. In my opinion, traditional IRA is better for most people
But with a traditional IRA, in your case, you'd get taxed on that lower income. (as opposed to if you had a Roth IRA and already paid taxes on the money). I'm not arguing either way, but interested why you think traditional IRA is better for most people?
@@thewealthworkshop I’m not a tax expert, so let me know if I get anything wrong here. With traditional IRA you are only taxed on whatever you withdraw, right? Let’s say I make $20,000 a year on Social Security retirement money and then I withdraw $10,000 from my traditional IRA. That means I am at $30,000 income. The long-term capital gains tax rate for that income is 0%. Does that mean I don’t have to pay any tax on the $10,000 I withdrew for my traditional IRA?
@@Veritas463 Q1 Yes. Q2 No. Withdrawals from traditional are taxed as ordinary income not as long term capital gains.
so I can trade on the stock market with a pretaxed roth ira and the gains i make will never be taxed?
Correct, since Roth IRA contributions are made with money you've already paid taxes on, you won't pay taxes on the money you withdraw from the account in retirement.
I don’t get it. At 4:15 you say there isn’t a limit on how much can be contributed to a Traditional IRA but later you say the limit is $6000 for both Roth and Traditional IRA. Please explain
Hey Raul! First, thanks for watching! The limit that I'm talking about at 4:15 is your income limit. So you can make as much money as you want and have the ability to put money into a Traditional IRA (up to the limit which is 7K for 2024), but if you make more income than 160K-ish (as of 2024) you will not be allowed to contribute to a Roth IRA at all.
So when u say I can pull my CONTRIBUTIONS out of a Roth IRA whenever I want that’s only taking the money I’ve put in not the newly earned interest?
That is correct. Pulling out earned funds could trigger taxes and/or penalties. (Keep in mind, I'm not a tax expert lol)
Both are good ❤
Agreed!
I go with the simple idea that when I am retired not paying taxes makes my money go farther
Agreed! One less thing to have to "fight" later on.
Taxes always go up why wouldn’t I pay the lower taxes now instead of the higher taxes in a lower tax bracket later?
Good point im thinking one plus is you can earn interest on the pretaxed amount but I didn’t think about the increase in tax
If your incone tax braket is 32% rn, and your retirement income tax bracket is 22%, then a traditional IRA is better because you ultimately pay less to the man.
What if I start a Roth IRA when my salary is $100,000 but after several years the salary rises above the $160,000 limit? I can no longer contribute?
(not financial advice lol) but yes, you couldn't contribute directly to the Roth IRA, but you could still contribute to a Traditional (pre-tax) IRA.
No contributions, but you'll still have the money and it will grow. Max it out while you can then open a traditional at the salary change.
So if I open a Roth IRA but a year down the road my income increases to 146k, what then?
You could potentially do a backdoor Roth conversion
Even explained with cartoons, they make it so confusing with the only purpose of stealing our money!!!!
how? you are the only one who will decide weather you invest your money or not in the first place. if you think that way, you can start building your spaceship and then go to the other planet and in there you can make your own rules and laws.
buffet would use it to pay taxes on his drip
WTH???? How in the world can you predict the future tax bracket to be able to choose between traditional or ROTH???? No one has a crystal ball!!!
Well, I for sure will never make an income of over 140k. So I know a traditional IRA is a safe bet. If you're in your early 20s, investing in IRA, and know you'll finish college and eventually make 200k salary then no.
@@chiquitodaviii2913Roth IRA* Traditional doesn't have a limit
@chiquitodaviii2913 if you can max out the IRA, Roth dollars are more valuable than traditional dollars. Otherwise I agree.
I did learn something today: My advisor is an idiot. I'm low income and he put me in a Traditional IRA.
Hmm, well traditional would mean you don't pay taxes on that money now, so it could lower tax burden? Hope you get it figured out. Thanks for watching!
Everyone is 100% sure will be in a higher or lower tax bracket 5, 10 or 15 years from now. Even in one year from now. Who invented this nonsense ponzi??? 🤣🤣🤣
Too fast and would have been excellent if explained with numbers, ley say 100 dollars invested and early withdrawal in 5 years and at retirement age
Hmm, numbers could be tough because there are SO many different avenues, but thanks for the suggestion. May make a second video where I split them up!