**BEST PLACE TO OPEN A ROTH?**

[2FORCEFULL]

FIDELITY???

 

[Carlson-jet]

Hold off and do some homework.
Depending on the investment vehicles things can get really complicated. Make sure they work for you.

 

[Dalton]

seems kinda late?

 

[mesquito_creek]

FIDELITY???

I have both fidelity and Schwab. It's kinda ford vs chevy. If you are not trading much but rather just buying and holding I can't see much of a difference. Fidelity does have there own fidelity S&P 500 index with zero expenses which is hard to beat.

 

[SLT Kota]

It depends on what you want to invest in (index, individual stocks, mutual funds etc) but all of the big internet ones are better than ones from a brick and mortar broker in my opinion.

 

[HB2Havasu]

I just put my money in a Roth with my credit union. It’s not going to win the internet in % growth but it pays a guaranteed rate so it’s a good place to drop $6K per year.

Since your a small business owner you should be looking at SEP’s. You can put a lot more in those yearly. ($28K yearly or some shit like that)

FYI - Both SEP’s and IRA’s require a withdrawal when you hit 70.

 

[Instigator]

Roth IRA doesn't require minimum distributions. You can draw from them tax free after 59 1/2 without penalties as long as they have matured for 5 years and you can continue to contribute to them too.
Yes you pay the tax on the deposit but All withdrawals are tax free. Traditional ira you are taxed on All withdrawls which is way more tax.
Hard to beat a Roth in most cases.

 

[franky]

I just put my money in a Roth with my credit union. It’s not going to win the internet in % growth but it pays a guaranteed rate so it’s a good place to drop $6K per year.

Since your a small business owner you should be looking at SEP’s. You can put a lot more in those yearly. ($28K yearly or some shit like that)

FYI - Both SEP’s and IRA’s require a withdrawal when you hit 70.

Effective 12/31/19, RMD (required minimum distribution) from traditional retirement plans was raised to age 72

 

[dnewps]

Fidelity if your just going to open a Roth IRA. If you would rather the flexibility to invest in Real Estate, private business, or Lend, Etc....Then I think the best Vehicle is a self directed Solo 401k with Roth and full checkbook control. You can contribute 25k per year into the Roth and your wife can do 25k. Then you can invest in what you like. It is as simple as having the 401k admin co draft the documents and you walk into the bank and open an account under the 401k trust name.

 

[Floatin']

Vanguard

 

[C08H18]

Fidelity if your just going to open a Roth IRA. If you would rather the flexibility to invest in Real Estate, private business, or Lend, Etc....Then I think the best Vehicle is a self directed Solo 401k with Roth and full checkbook control. You can contribute 25k per year into the Roth and your wife can do 25k. Then you can invest in what you like. It is as simple as having the 401k admin co draft the documents and you walk into the bank and open an account under the 401k trust name.

Solo 401K is a great option for those of us that are self employed. I was able to make > $50K contribution after my accountant completed the return and calculated the maximum amount. It is too late for 2019 tax year as the account must be setup before the end-of-year. Actual contribution can be made anytime before filing.

 

[Turnup]

I was just opening a couple of UTMA's on my phone for the kids, nieces, and nephews on the TD Ameritrade mobile app..very easy, and the takeover from Schwab is going down seems like a win win. $0 for on app trades, sounds good with me. Can do a ROTH too but this thread has me considering a SEP so back to consideration on those ones. Anyone not down w the TD?

 

[RPM RACING]

TD Ameritrade and you have until tax day in April to do it for 2019.

 

[Turnup]

Fidelity if your just going to open a Roth IRA. If you would rather the flexibility to invest in Real Estate, private business, or Lend, Etc....Then I think the best Vehicle is a self directed Solo 401k with Roth and full checkbook control. You can contribute 25k per year into the Roth and your wife can do 25k. Then you can invest in what you like. It is as simple as having the 401k admin co draft the documents and you walk into the bank and open an account under the 401k trust name.

Hows the flexibility work on this to invest in RE and or lending?? I can certainly pull 50 out and lend on a few deals and be able to show tons of profit to shove back within a 12 mo period easily..how would that work?

 

[bowtiejunkie]

TD Ameritrade works well for me. Many different types of investments. With TD merging with Charles Schwab, I would think it would get even better.

 

[WildHorses24]

seems kinda late?

Late in life? [emoji23]


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[Motor Boater]

Vanguard

X2

 

[mesquito_creek]

seems kinda late?

It’s never to late...

Since Schwab is buying up all the small guys, go with them! I have had an account at Schwab for 25 years without issue. But all I ever do is buy stock indexes and let it ride, I don’t actively trade.

 

[2FORCEFULL]

doesn't roth make it easy to transfer to kids....???

 

[Halvecto]

doesn't roth make it easy to transfer to kids....???

Yes, primarily because Roth (IRA or 401k) structure doesn't ever trigger RMD (required minimum distribution, which is now 72). So Beneficiary IRA rules don't affect the ROTH, allowing kids to keep the money growing. Also, it comes out tax-free to them also, so step-up basis issues are gone.

 

[78Southwind]

Fidelity if your just going to open a Roth IRA. If you would rather the flexibility to invest in Real Estate, private business, or Lend, Etc....Then I think the best Vehicle is a self directed Solo 401k with Roth and full checkbook control. You can contribute 25k per year into the Roth and your wife can do 25k. Then you can invest in what you like. It is as simple as having the 401k admin co draft the documents and you walk into the bank and open an account under the 401k trust name.

This

You can also use leverage in a Solo 401(k) when it comes to investments like real estate and you don't have to pay taxes on the gains due to the leverage if the deal is set-up right.

 

[78Southwind]

You should contact Mitt Romney.

 

[2FORCEFULL]

Fidelity if your just going to open a Roth IRA. If you would rather the flexibility to invest in Real Estate, private business, or Lend, Etc....Then I think the best Vehicle is a self directed Solo 401k with Roth and full checkbook control. You can contribute 25k per year into the Roth and your wife can do 25k. Then you can invest in what you like. It is as simple as having the 401k admin co draft the documents and you walk into the bank and open an account under the 401k trust name.

so you can only put 50k in a roth??? what if you need to move 6 or 7 figures???...I'm try'n to pull out of the mortage lending game...and though I have 2 homes being built,... I wanna quit that also..I just wanna a rabbit hutch..... beer in hand, toes in sand, and money breeding 24/7..I keep reading where people say they make a minimum 20% return every year..lol...I'm lucky to make 5%...

so with a roth, the money is taxed already,... but no tax on gains???

 

[Turnup]

I don't think you can put 50 in a ROTH, and the money is considered after tax funds so no tax on gains in the future which is why you can't put that much dough into it every year. I too was lookin at future stuff for the kids but don't think I will want to retire doing the flip game, I've consistently hit double digits and hit the 30 mark a few times for the year but that's balls to the wall grinding...I shoot for 10% ea deal and try to turn 3x in a year to get the big #s.

 

[mjc]

Roth money has to come out starting at 72 now so I don't see it as a way to save or give money to kids. you can set them up one for each kid now.

 

[cole_skier]

Roth money has to come out starting at 72 now so I don't see it as a way to save or give money to kids. you can set them up one for each kid now.

ROTH has no “required minimum distribution” so you don’t have to start withdrawals like you do with a traditional IRA. Also ROTH contributions must be from earned income (1099, w2) money. They also have annual contribution limits.


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[Halvecto]

so you can only put 50k in a roth??? what if you need to move 6 or 7 figures???...I'm try'n to pull out of the mortage lending game...and though I have 2 homes being built,... I wanna quit that also..I just wanna a rabbit hutch..... beer in hand, toes in sand, and money breeding 24/7..I keep reading where people say they make a minimum 20% return every year..lol...I'm lucky to make 5%...

so with a roth, the money is taxed already,... but no tax on gains???

Yes, Roth is "after-tax" money. But, principal and/or gain will not be taxed again after contribution or w/drawl. That said, there are income limits for eligibility. IMHO, Roth accounts are the most efficient and beneficial structure. It would make sense that it's also one of the more difficult ones to get lots of $$ in to.

Contribution limits if over 50 .....

Traditional IRA: $6k + $1k catch-up (til Apr 15)
Roth IRA (eligibility subject to income limits), same: $6k + $1k catch-up
Simple IRA: $13k + $3k catch-up (til Apr 15 or extension filing to Oct if no employees)
SEP IRA: up to $56k (til Apr 15 or extension filing to Oct if no employees)
401k (Solo or Company): $19k + $6k catch-up. Doesn't include Co. matching or safe harbor contributions. BTW, too late to set up 401k for 2019.

@shintoooo will know all these contribution deadline dates

Moving 6 or 7 figures. Umm. There are DB (defined benefit) plans that can stuff quite a bit of money in, but be very careful. They require a long-term commitment to funding and aren't purposed for single-year big deductions. Seen too many guys let the tax-tail wag the dog on these, only to be all bound-up soon after.

 

[The Prisoner]

Give your money to David Lee Roth for singing lessons!!!

 

[Carlson-jet]

I love these threads. Some pretty impressive knowledge that took a lot of time to gather but is shared.
It's incredible how much one can pay themselves to manage their own investments.
Not every post fits every need but it gives some damn good food for thought.

 

[Outdrive1]

FIDELITY???

Aren’t you like 80 already?


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[Dalton]

so you can only put 50k in a roth??? what if you need to move 6 or 7 figures???...I'm try'n to pull out of the mortage lending game...and though I have 2 homes being built,... I wanna quit that also..I just wanna a rabbit hutch..... beer in hand, toes in sand, and money breeding 24/7..I keep reading where people say they make a minimum 20% return every year..lol...I'm lucky to make 5%...

so with a roth, the money is taxed already,... but no tax on gains???

I think I make like 15%....seen tons of people fuck themselves trying to play stocks like Vegas. Johnson Johnson, Valero, Disney, fedex, etc. nothing crazy...you’ll make money though, this is just investing I don’t know much about Roth’s and tax shielded things cause I never thought long term...oops


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[dnewps]

so you can only put 50k in a roth??? what if you need to move 6 or 7 figures???...I'm try'n to pull out of the mortage lending game...and though I have 2 homes being built,... I wanna quit that also..I just wanna a rabbit hutch..... beer in hand, toes in sand, and money breeding 24/7..I keep reading where people say they make a minimum 20% return every year..lol...I'm lucky to make 5%...

so with a roth, the money is taxed already,... but no tax on gains???

If you set up a solo 401k plan for your business then you as your business’ employee can contribute up to 19k + 6k based on age from your paycheck. If your wife is also an employee of your business she can do the same. That’s 50k per year contributions that you are allowed to do as Roth. You can’t move 6 or 7 figures into it unless it is coming from another ira, 401k, etc. if you have already paid taxes you probably don’t want to do that anyway.

 

[dnewps]

I think I make like 15%....seen tons of people fuck themselves trying to play stocks like Vegas. Johnson Johnson, Valero, Disney, fedex, etc. nothing crazy...you’ll make money though, this is just investing I don’t know much about Roth’s and tax shielded things cause I never thought long term...oops


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3 ways to get money into your solo 401k plan. Contributions from your paycheck, company match, and company contribution (profit share, has nothing to do with profitability....just the name). There are several rules that must be followed...the main one is that you can’t get more money in the plan than you are paying yourself. The other is the annual limits set by irs.

Mysolo401k.com. They will set up the plan and help you follow the rules

 

[dnewps]

This

You can also use leverage in a Solo 401(k) when it comes to investments like real estate and you don't have to pay taxes on the gains due to the leverage if the deal is set-up right.

If you have a solo 401k with checkbook control you can borrow for real estate. It is a non recourse loan which means the property secures the loan not an individual or their individual credit. Downside is that you need close to 50% down (from the 401k) and the rate is higher.

 

[Flatsix66]

For big money there is a limit to how much you can put into a tax advantaged account. After tax investing with low fees and great earning look at a Vanguard VIIIX index fund.

 

[dnewps]

Hows the flexibility work on this to invest in RE and or lending?? I can certainly pull 50 out and lend on a few deals and be able to show tons of profit to shove back within a 12 mo period easily..how would that work?

If you have a solo 401k with checkbook control you are not “pulling” money from the plan or borrowing against the plan. You have checkbook control to invest within the plan. It is as simple as writing the check and the deed is in the name of the 401k trust.

 

[Flatsix66]

"Mega Backdoor Roth" you can put in $62k a year (50+).

 

[dnewps]

"Mega Backdoor Roth" you can put in $62k a year (50+).

Not sure what you mean. I’m pretty sure only 19k + 6k over 50 years old into Roth. Matching and profit share go into 401k from the company as pre-tax not Roth which is post tax.

 

[78Southwind]

If you have a solo 401k with checkbook control you can borrow for real estate. It is a non recourse loan which means the property secures the loan not an individual or their individual credit. Downside is that you need close to 50% down (from the 401k) and the rate is higher.

I have seen as low as 40% down but I have never owned my own business (so shit out of luck for me) but I have tried to get my Father to do it via his business. Do you own any property through your 401(k)/Roth. If so and you have personal experience let us know of any other pit falls.

 

[78Southwind]

Not sure what you mean. I’m pretty sure only 19k + 6k over 50 years old into Roth. Matching and profit share go into 401k from the company as pre-tax not Roth which is post tax.

I think he is talking about making after-tax contributions (if the plan allows them) and then rolling them into a Roth IRA (if the plan allows in-service rollovers) along with normal Roth 401(k) contributions. Up to 57,000 total in a 401(k) and $7,000 in a Roth IRA if you qualify and are old (50).

 

[dnewps]

doesn't roth make it easy to transfer to kids....???

BTW: If you are trying to get 6 to 7 figures into a plan that grows without tax and is tax free upon transfer or later in your life AND are interested in stock investment you may want to consider a life insurance vehicle. Hit up @jddearden for help. I think it’s called universal indexed life insurance. Basically it is a contract based on the stock market index. Buy the contract with after tax money. If the stock index goes up then your contract value goes up the same amount. There is a ceiling on how much you can gain if there is an unusually high gain in the stock index but there is also a floor to protect you from losing money. The scenario that you are describing is why this insurance product was created. Might be a better fit than a defined contribution plan like IRA, 401K, ETC

 

[Flatsix66]

Not sure what you mean. I’m pretty sure only 19k + 6k over 50 years old into Roth. Matching and profit share go into 401k from the company as pre-tax not Roth which is post tax.

Its sort of a new thing. My company just started offering it through Fidelity, but I'm sure it's widespread by now. https://www.nerdwallet.com/blog/investing/mega-backdoor-roths-work/

 

[dnewps]

I have seen as low as 40% down but I have never owned my own business (so shit out of luck for me) but I have tried to get my Father to do it via his business. Do you own any property through your 401(k)/Roth. If so and you have personal experience let us know of any other pit falls.

I have a solo 401k with checkbook control. I went this way because I feel more comfortable investing in a tangible thing like rentals vs. stock. Non recourse loans Are secured by the property itself so the lenders want more down and interest. 40% down may be out there...but you would need to shop. The big pit fall is that if you are the trustee, trustor, and beneficiary of your 401k trust....you absolutely cannot engage in a prohibited transaction irs rules.). The gist of a prohibited transaction is that you can’t do business in this trust (selling products or services, etc) this is designed as a passive investment. And you can’t do transactions with yourself. Think present self and future self. Self also means your immediate family, including your wife’s parents. Can’t for example short term flip a house, move into the house you bought with 401k or sell to family.

 

[dnewps]

Its sort of a new thing. My company just started offering it through Fidelity, but I'm sure it's widespread by now. https://www.nerdwallet.com/blog/investing/mega-backdoor-roths-work/

Very interesting! Thanks for sharing that. So if I understand correctly, irs allows you to convert existing pre-tax 401k contributions to post-tax (pay the tax on income) and if the plan is written to allow in plan conversions....you are left with higher post tax contributions than normally allowed. Confusing but pretty slick.

 

[Flatsix66]

Very interesting! Thanks for sharing that. So if I understand correctly, irs allows you to convert existing pre-tax 401k contributions to post-tax (pay the tax on income) and if the plan is written to allow in plan conversions....you are left with higher post tax contributions than normally allowed. Confusing but pretty slick.

Yeah first $19+6 in 401k pre-tax + company match 6% + after tax saving up to the $62k max for each of us. The after tax gets rolled into a roth on the same day it's contributed to prevent any tax implication. +HSA pretax $7k + Company match = grows tax free. Pretty slick

 

[78Southwind]

I have a solo 401k with checkbook control. I went this way because I feel more comfortable investing in a tangible thing like rentals vs. stock. Non recourse loans Are secured by the property itself so the lenders want more down and interest. 40% down may be out there...but you would need to shop. The big pit fall is that if you are the trustee, trustor, and beneficiary of your 401k trust....you absolutely cannot engage in a prohibited transaction irs rules.). The gist of a prohibited transaction is that you can’t do business in this trust (selling products or services, etc) this is designed as a passive investment. And you can’t do transactions with yourself. Think present self and future self. Self also means your immediate family, including your wife’s parents. Can’t for example short term flip a house, move into the house you bought with 401k or sell to family.

I was speaking more to personal pit falls. The examples you gave are all on the internet to read. I was thinking more along the lines of things you may not read on the internet. Maybe for example it takes twice as long to fund a property through a 401(k) or the lender wants to see where the contributions came from for the last 5 years. (Just making up scenarios to give you examples what I was looking for). Thanks

 

[dnewps]

I was speaking more to personal pit falls. The examples you gave are all on the internet to read. I was thinking more along the lines of things you may not read on the internet. Maybe for example it takes twice as long to fund a property through a 401(k) or the lender wants to see where the contributions came from for the last 5 years. (Just making up scenarios to give you examples what I was looking for). Thanks

To your point, yes it takes at least twice as long since you have to first fund the 401k. I am in the funding stage. I am about to fund my third year then I can buy RE, take a non recourse loan, etc. You could be in stocks while funding the plan then liquidate to purchase the RE. I’m too conservative for that.