Why are IRA contribution limits kept so LOW ($6K/$7K)? They should be made the SAME as 401k limits so that folks without a 401K can be on equal footing! Somehow this video has helped shed light on some things but I'm aiming to create a portfolio worth not less than $2m before I turn 60.
A solid strategy can be a key component of an investor’s portfolio. Well, the bigger the risk, the bigger the reward and such impeccable decisions are better guided by professionals.
Yes true, I learnt that in 2020, when I lost almost everything. But I switched to using a financial advisor and I've been returning at least $98k every month so I’ve been sticking to investing via an Advisor.
No, as a matter of fact I always preferred to handle my own investing, but after my portfolio took a major hit in 2020, I really had to rethink my plans for the future, so I reached out to my F.A Natalie Lynn Fisk who really helped me balance up my losses.
@@MarkGrimm8 Thank you for this tip. It was easy to find your advisor. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her resume
Great video! Keeps it simple and informative. I didn't even know there was a Roth option for the TSP and ended up looking into it as a result. My next question was whether traditional individual and TSP were the better options versus Roth and also got that answered by the end of the video. Thanks!
@@TravisSickle Hey! I am becoming Self employed in a month time since i moved here few months ago, i am getting my EAD in January. If you know any good Tax consultant to help with the process and to help me with all the Quarterly and annual forms will be super helpful!
Great stocks and I just bought in on them, but I'm interested in making short term profit, let say turn a $150K to $500k in 6months, I'd appreciate tips on how what stocks to buy to make this much profit.
Thank you so much Travis. This is the clearest explanation of the 401(k) and IRA's that I have came across. I have one question for clarification of my own situation: I am 55 yr-old, married (MJF) with a AGI of $80,000 in 2020, I contributed the max of $26,000 for my work-place 401(k) plan. My question is, are we still allowed to open a traditional IRA or Roth IRA account for an additional $7,000 contribution? I wasn't clear whether the $26,000 or the $33,000 should be the total amount (401k and IRA).
Great video! In 2020, can my wife and I contribute $19,500 each (total of $39k) tax deferred as long as none of us goes over that $19,500 mark individually?
Al Rocky thanks for responding. Isn’t their a phase-out on the IRA contribution? I thought you could only do IRA if you made under a certain threshold.
@@alrocky Quick question -- the video mentions that some lucky folks have access to two formal retirement plans at work. If one of the spouses in this example has access to two plans and the other spouse has access to one, could they max out all three plans? Would all three be tax deductible at the full $19,500 level for a total tax deduction of approximately 60k? In this example, I am assuming that they want to invest in traditional IRAs for all three.
What about Spillover into post-86 that allows you to contribute beyond the max, which actually tops out at 57000 for 2020. If that money is then rolled over to the roth, are you subject to the roth 401k limits for that year, or is that more of an unaccounted for feature of the recent changes in retirement savings.
I don’t know what post-86 is but Roth conversions do not affect contribution limits because they are not contributions, they are conversions. So yes, it’s “unaccounted” money.
My company offers traditional 401k and Roth IRA with a match. Am I allowed to contribute max amount of $19,500 in traditional 401k PLUS $6,000 Roth 401k (as long I am within the phaseout income limit)? Also, can my wife do the same? We are filling tax MFJ. TY
I maxed out my pretax 457b plan through my employer for 2020. I also maxed out my Roth IRA with Vanguard for 2020. Can I still contribute to a traditional IRA and if so how much can I contribute? I’m finally learning about the finance world and I’ve been watching your videos. Thank you for all that you do.
No, the max for Roth and Traditional are $6k combined. That will also include non-deductible to traditional side too. No limits on conversions but that’s not technically a contribution.
Can you contribute the maximum limit to a 401k and to the Roth IRA limit? So say I want to do the max in a traditional 401k and also max a personal Roth IRA. Can you contribute the max in both?
Thank you sm for this video. I am in a predicament and not sure how to proceed. I have a 401k with my employer that has a match limit. I also just opened up a Traditional IRA to lower my taxable income and have another investment account. The problem is I just learned my salary is too high (>75k) to receive that deduction. So how am I benefiting from contributing to my IRA? I think it is too late to switch to a ROTH. UGH!
I am currently contributing to a 401K at work. In addition, I am also contributing to a traditional IRA. But as this video has stated my contributions to my traditional IRA do not lower my taxable income. So the question is what benefit do I gain by contributing to a non deductible IRA? Am i better off contributing to a Roth IRA with after tax money instead? My income is high and I am looking to lower my taxable income.
Question though - If you put in the 19,500 in traditional for 2020, are you then prohibited from investing in roth ? Or, can you still put in another 6 k in the roth, plus the 19,500 for a total agregate of 25,500 for the year ? (obv. more if your over 50, but let's keep it simple).
The non-deductible IRAs have a negative side. When you take distributions you can't take out the non-deductble non-taxable portion out separately . From what I have read have to take only as percent of total traditional IRAs as withdrawn resulting in not being able to withdraw the tax free base portion you originally paid for years along with tracking base calculations for portion tax free for years. I never would take a non-deductible IRA like I did if I had known this would happen but would have invested monies elsewhere.
Hi sir. Your videos are really helpful thanks. Can you plz cover the deposit of contribution and sequences of late deposit by employer as well. Or at least reply on where to source the same.
Hi Travis could you please share your ideas how to fix over contribution in prior years as i was not deducting it on my return and when i try to fix it by withdrawing it in the following year before extension deadline in October 15th it. The SEP IRA custodian treats it as distribution and it will be charged as income plus 10% penalty which is unfair. As it was never deducted from income. For example i overcontributed $1000 over my limit of let's say 7000. On my return in 2020 i only deducted as per my limit $7000 even i overcontributed $1000. Now in 2021 i transfering my overcontribution of $1000 back. And it is treated as distribution even though i never deducted it on my 2020 and i still have time with my extension till October 15th 2021. Let me know what you think.
If your employer offers both a 401(k) and Roth 401(k), would you be allowed the normal 401(k) contribution limit based on the accounts combined, or each individually? In other words, if you contributed to both, would you be allowed the limit for each account, or just the combined amount?
Wait, so if 401k contribution limit is 19k and a Roth is 6k, if you have both is your total contribution limit for both around 25k? Or is the contribution limit to both set to 6k?
So technically I can contribute 19,500 into my 457roth at work and also contribute 6000 (considering i qualify for income limitations or i use the Backdoor roth route) into my Individual roth ira for a total of $25,500 in 2 different roth accounts ?
Is it a requirement to make contributions annually to ROTH IRA or can I just open an account with a certain amount and either just leave it there and let it grow over time or just contribute whenever I like since I already have 401K anyway.
Hi Travis I will be working only for 3 months in 2021. I opted for max contribution and by the end of the 3 monthly my contribution will be 9000 as annual limit is 19500. did i contribute more based on prorate? can I still max out my contributions?
Is anyone able to answer a two basic questions for me: 1) what is the max amount one can contribute (non deductible or otherwise) to a Roth IRA in 2020 if AGI is >$198k but < $206k? 2) what is the max amount someone can contribute (non deductible) to a regular IRA in 2021 if AGI is >$206k ? In both cases one spouse has existing employer 401k.
Here is the updated version of this video for 2021 th-cam.com/video/iA6QXa0BSJw/w-d-xo.html
Why are IRA contribution limits kept so LOW ($6K/$7K)? They should be made the SAME as 401k limits so that folks without a 401K can be on equal footing! Somehow this video has helped shed light on some things but I'm aiming to create a portfolio worth not less than $2m before I turn 60.
A solid strategy can be a key component of an investor’s portfolio. Well, the bigger the risk, the bigger the reward and such impeccable decisions are better guided by professionals.
Yes true, I learnt that in 2020, when I lost almost everything. But I switched to using a financial advisor and I've been returning at least $98k every month so I’ve been sticking to investing via an Advisor.
@@MarkGrimm8 That’s impressive, have you always had a financial advisor?
No, as a matter of fact I always preferred to handle my own investing, but after my portfolio took a major hit in 2020, I really had to rethink my plans for the future, so I reached out to my F.A Natalie Lynn Fisk who really helped me balance up my losses.
@@MarkGrimm8 Thank you for this tip. It was easy to find your advisor. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her resume
Great video! Keeps it simple and informative. I didn't even know there was a Roth option for the TSP and ended up looking into it as a result. My next question was whether traditional individual and TSP were the better options versus Roth and also got that answered by the end of the video. Thanks!
Great job Travis. Truly a wonderful piece you posted. Thanks!
Thank you
You da man Travis
kingofthedeepsea thanks for watching!
Awesome !!!!
Great video! Looking forward for one for self employed 👍
Luis Cambronero which plan do you have?
@@TravisSickle Hey! I am becoming Self employed in a month time since i moved here few months ago, i am getting my EAD in January. If you know any good Tax consultant to help with the process and to help me with all the Quarterly and annual forms will be super helpful!
@@LuisCP85 send me an email with contact info and I can forward and see what we can do. travis.sickle@sicklehunter.com
@@TravisSickle done, thanks!
Learned a lot, thanks for the content , good job!
Great stocks and I just bought in on them, but I'm interested in making short term profit, let say turn a $150K to $500k in 6months, I'd appreciate tips on how what stocks to buy to make this much profit.
@Samanthwalter Archie That sounds great and how do i connect with her ?
@Samanthwalter Archie Okay i just found her website and left a message for her. thanks.
Great information thank you!
Thank you so much Travis. This is the clearest explanation of the 401(k) and IRA's that I have came across. I have one question for clarification of my own situation: I am 55 yr-old, married (MJF) with a AGI of $80,000 in 2020, I contributed the max of $26,000 for my work-place 401(k) plan. My question is, are we still allowed to open a traditional IRA or Roth IRA account for an additional $7,000 contribution? I wasn't clear whether the $26,000 or the $33,000 should be the total amount (401k and IRA).
Great video! In 2020, can my wife and I contribute $19,500 each (total of $39k) tax deferred as long as none of us goes over that $19,500 mark individually?
Al Rocky thanks for responding. Isn’t their a phase-out on the IRA contribution? I thought you could only do IRA if you made under a certain threshold.
@@alrocky Quick question -- the video mentions that some lucky folks have access to two formal retirement plans at work. If one of the spouses in this example has access to two plans and the other spouse has access to one, could they max out all three plans? Would all three be tax deductible at the full $19,500 level for a total tax deduction of approximately 60k? In this example, I am assuming that they want to invest in traditional IRAs for all three.
What about Spillover into post-86 that allows you to contribute beyond the max, which actually tops out at 57000 for 2020. If that money is then rolled over to the roth, are you subject to the roth 401k limits for that year, or is that more of an unaccounted for feature of the recent changes in retirement savings.
I don’t know what post-86 is but Roth conversions do not affect contribution limits because they are not contributions, they are conversions. So yes, it’s “unaccounted” money.
@@TravisSickle Post-86 might be unique to fidelity, but it is an after tax account within my companies 401k
What about Simple-IRA, SEPP or solo-401K? You are missing the self-employed and small businesses.
I'm going to do some just for SMB soon.
My company offers traditional 401k and Roth IRA with a match. Am I allowed to contribute max amount of $19,500 in traditional 401k PLUS $6,000 Roth 401k (as long I am within the phaseout income limit)?
Also, can my wife do the same? We are filling tax MFJ. TY
I maxed out my pretax 457b plan through my employer for 2020. I also maxed out my Roth IRA with Vanguard for 2020. Can I still contribute to a traditional IRA and if so how much can I contribute? I’m finally learning about the finance world and I’ve been watching your videos. Thank you for all that you do.
No, the max for Roth and Traditional are $6k combined. That will also include non-deductible to traditional side too. No limits on conversions but that’s not technically a contribution.
Can you contribute the maximum limit to a 401k and to the Roth IRA limit? So say I want to do the max in a traditional 401k and also max a personal Roth IRA. Can you contribute the max in both?
Thank you sm for this video. I am in a predicament and not sure how to proceed. I have a 401k with my employer that has a match limit. I also just opened up a Traditional IRA to lower my taxable income and have another investment account. The problem is I just learned my salary is too high (>75k) to receive that deduction. So how am I benefiting from contributing to my IRA? I think it is too late to switch to a ROTH. UGH!
Contribute to an HSA account to lower taxable income.
@@wtf6713 but what is the benefit of having the IRA if there is no tax deduction since I have an existing 401k? Did I make a mistake?
@@michelleculbert2983 Look in the IRS form 8606.
I am currently contributing to a 401K at work. In addition, I am also contributing to a traditional IRA. But as this video has stated my contributions to my traditional IRA do not lower my taxable income. So the question is what benefit do I gain by contributing to a non deductible IRA? Am i better off contributing to a Roth IRA with after tax money instead? My income is high and I am looking to lower my taxable income.
I am in the same boat and so confused what to do!!!
@@alrocky just to clarify my 401k gets maxed out every year. The traditional contribution was in addition to the 401k.
Question though - If you put in the 19,500 in traditional for 2020, are you then prohibited from investing in roth ? Or, can you still put in another 6 k in the roth, plus the 19,500 for a total agregate of 25,500 for the year ? (obv. more if your over 50, but let's keep it simple).
Yes, you can do $19,500 into retirement plan at work and then another $6k in the Roth. Assuming you qualify based on income and limits etc.
The traditional ira and Roth IRA aggregate. Meaning $6k total. The same would be true for Roth 401k and traditional side, that’s $19,500 total.
@@alrocky a lot of people get confused because they forget about the Roth IRA income limits.
The non-deductible IRAs have a negative side. When you take distributions you can't take out the non-deductble non-taxable portion out separately . From what I have read have to take only as percent of total traditional IRAs as withdrawn resulting in not being able to withdraw the tax free base portion you originally paid for years along with tracking base calculations for portion tax free for years. I never would take a non-deductible IRA like I did if I had known this would happen but would have invested monies elsewhere.
Correct, pro-rata rules. Non-deductible works when you don’t have traditional Ira money and then convert to Roth.
I make 140k
I max out 403b 19k
Can I open tradition and max it out 6k?
Hi sir. Your videos are really helpful thanks.
Can you plz cover the deposit of contribution and sequences of late deposit by employer as well. Or at least reply on where to source the same.
Hi Travis could you please share your ideas how to fix over contribution in prior years as i was not deducting it on my return and when i try to fix it by withdrawing it in the following year before extension deadline in October 15th it. The SEP IRA custodian treats it as distribution and it will be charged as income plus 10% penalty which is unfair. As it was never deducted from income.
For example i overcontributed $1000 over my limit of let's say 7000. On my return in 2020 i only deducted as per my limit $7000 even i overcontributed $1000. Now in 2021 i transfering my overcontribution of $1000 back. And it is treated as distribution even though i never deducted it on my 2020 and i still have time with my extension till October 15th 2021. Let me know what you think.
It’s not as income, only the growth. Under 59.5 is 10% penalty. Did you double check your contribution limit? That’s where I would start.
T, can we make Non deductible Contributions past the $6000 limit ?
over 50, $1k more. Under, not for TIRA. You can for the solo 401k.
@@TravisSickle T, this is not good, the government wants our money too much..
2020 Once rolled over to my rollover IRA, can I still contribute by transferring from my bank where my pay check is connected?
If your employer offers both a 401(k) and Roth 401(k), would you be allowed the normal 401(k) contribution limit based on the accounts combined, or each individually?
In other words, if you contributed to both, would you be allowed the limit for each account, or just the combined amount?
Combined
Wait, so if 401k contribution limit is 19k and a Roth is 6k, if you have both is your total contribution limit for both around 25k? Or is the contribution limit to both set to 6k?
So technically I can contribute 19,500 into my 457roth at work and also contribute 6000 (considering i qualify for income limitations or i use the Backdoor roth route) into my Individual roth ira for a total of $25,500 in 2 different roth accounts ?
Yes, it’s possible.
So, can I max my traditional TSP 19,500 a year and also max my roth ira at 6,000 a year? Thus saving 25,500 a year for retirement?
Yes
Can I contribute to my employers 401k and still contribute to my IRA?
You’ll need to check your income limits. Here is the video on that th-cam.com/video/wryupwLRjis/w-d-xo.html
Max contribution on a roll over ira?
What if my 401k only has s and p 500; can I start my own 401k elsewhere?
Same as traditional Ira. If you own the business yes
Is it a requirement to make contributions annually to ROTH IRA or can I just open an account with a certain amount and either just leave it there and let it grow over time or just contribute whenever I like since I already have 401K anyway.
There is no minimum requirement. You can save the maximum, nothing at all or any amount in between. It's your choice.
@@TravisSickle ok thank you
Hi Travis
I will be working only for 3 months in 2021. I opted for max contribution and by the end of the 3 monthly my contribution will be 9000
as annual limit is 19500.
did i contribute more based on prorate?
can I still max out my contributions?
sounds correct.
@@TravisSickle thanks Travis. so I should take out the excess contribution right
Yes, but also growth or less if loss.
Is anyone able to answer a two basic questions for me: 1) what is the max amount one can contribute (non deductible or otherwise) to a Roth IRA in 2020 if AGI is >$198k but < $206k? 2) what is the max amount someone can contribute (non deductible) to a regular IRA in 2021 if AGI is >$206k ? In both cases one spouse has existing employer 401k.