I consider this on topic because I've learned from the older members it's things like this that got them in the position later in life to club like they do today...as a young man learning how to get their for my older age...I just want to say thank you for the help to all the older and wiser members and to the younger dudes bear minimum at least do this for your strip club foundation funds as a older gentleman
God bless and happy endings
Juice
That's great that you are taking the initiative. I had been toying with the same idea thinking, if I have time to post on Tuscl, then I have time to get a second job and get more money.
My 401k got max'ed out back around early June with one job. But, yeah, 401k's are great and you should sock as much money into them as you can. Later on you can even loan money to yourself (up to $50k) to use as a down payment for a mortgage. It's especially good if you work in a high tax state (like NY or CA) but will only draw on that money when you retire to a lower tax state.
Another way to play the tax savings is to consider the counter-intuitive: since they are tax advantages want to do investments which won't be get long term capital gains advantages there and then keep your long term capital gains in taxable accounts. That kind of run contrary to the idea that they are long term investments, however, so not for the faint of heart.
Finally, if you are self-employed the limits of what you can put into a 401k are much higher than if you are working for the man.
Most employers I know of will not allow you to work two jobs, however.
Thanks for the encouragement, advice and laughter guys
@juice: Do either of your employers do a 401k match?
Definitely max out your ROTH IRA before maxing out your 401k. The Roth IRA will let you xo tribute only $5500/annually, but if you run into a pinch you can always grab whatever you put into it.
The Roth gives you no tax deduction, but it grows tax free and free of any taxes upon withdrawal after age 59 and 1/2. I don't know if any investment vehicle other than your primary residence that allows tax free growth.
Your 401k has limitations upon withdrawals and will be subject to penalties and taxes if withdrawn before age 49 and 1/2. So what does a guy like Juice do? Max out his Roth IRA first, while contributing enough to get his company match in his 401k. If he is serious about saving he can also try to max his 401k, after his Roth has been maxed out. Peace! You owe me $500 for that advice. In the organization I am building it will be a fee based service, none of this % based on assets payment.
Dougster just the full time job. That's the one I just Max out. The part-time job I'm using to replace that missing income
Meat thanks for the tip. I do have a mutual fund I'm making monthly contribute into as well but that's after tax.
The additional pre tax savings into a IRA is a damn good idea to save even more.
Basically I'm making more money than I ever have in my life. I'm used to living and am currently living off of $12,000 a year...currently just hit what should be $52,000 pre tax per year now
Trying to invest and be smart with my excuse. Thanks to everyone directing me into solid advice.
Not sure if I mentioned it this year but early this year I got into a owner finances rent to own house that I'm living in. I rented out the 2 rooms to gain a rent free situation and once the place is paid off I will own the home for only the down payment to get in.
Figured if I could live in a van I could sleep on my own couch and create wealth and own a home eventually with some creative thought and other people's money
After reading Meat's advice I wondered why I didn't have a Roth IRA, then I realized there is an upper limit to income to be eligible. So if you are too RICH of a STUD, like me, I guess you can't take advantage of them.
Maybe you could find a part time job in a strip club. That would be brilliant!!!
Shoot, maybe I could find one of those.
I can't be a bouncer, however. I failed the IQ test by scoring over 75. :-(
Oh Dougster, how can anyone be the mane when you're da MANE?!
The "back door" IRA is used for rich fuckers who have high income and are over the limits like us. Sometime in December contribute into a traditional IRA, and then when January rolls around simply convert it over to a ROTH. Perfectly legal and accomplishes the same thing, except you have to do the extra step. I know when you make $200-$300k annually your thinking "why the fuck do I give a shit about placing $5,500 into a Roth?" Fact is over several decades with growth you will have tax free income, and as older adults on entitlements know that the higher income tax bracket you're in, they tax you more on Medicare premiums and social security. Having more into a Roth without subjecting yourself to income in retirement helps keep those double taxation entitlements from hitting your pocketbook in retirement.
Dougster, you owe me $500 for this fee based service! So does anyone else reading this, and getting smarter from my brilliance!
The non-deductible traditional Ira mentioned above can be done for anyone with any one making an income. ^^^^
Meat explain how that works if you put $6000. into a regular IRA in December then come January roll over to a Roth wont taxes be due? I am not grasping the concept here. Please expand on this.
Ah, that's very clever Meat. Definitely worth $500.
Twentyfive, it's quite simple, you wouldn't owe any taxes on a non-deductible IRA contribution, right? And since there wouldn't be any growth from December to January, you would only owe taxes on the growth from a non-deductible contribution into a traditional Ira.
This is why to avoid any taxes, making the no deductible contribution owes no tax, and there should t be any growth from December to January, especially if the contribution was parked into a money market earning no interest until the conversion was made. 25, you owe me $500!
Yes, but I maybe am missing something here, the original contribution was made to reduce my tax bill, would I not owe the taxes that I avoided by making the original contribution ? BTW $500. is more than the amount of taxes I would owe please value your advice appropriately........-)
twentyfive, these questions are non-brilliant! Didn't you hear that Meat72 is charging for financial advice? You've asked two questions so that's $1K on top of the original $500. He'll track you down and get his $1500 from you. ;)
4got-I am willing to pay for quality top of the line financial advice but before I pay for any advice it needs to be evaluated and explained in such a way that a financial illiterate like myself can understand. This is my vetting process if you want to get paid you need to contribute.
Really good tips
Juicy, just so you know...
Those 18 year old backpage strippers you fuck on Wednesday night while your moms out playing bingo don't think you're young!!!! Lol
You've got some illegitimate children, right? Look into 529 education trusts. I have one for each of my kids. You put money in tax free, your kids withdraw it at their tax rate. They're pegged to tuition of the 3 largest school in the state. Have you ever heard of tuition being reduced anywhere? These trust can't do anything but grow.
Shailynn lol fucker lol
Beaver I like this idea
I seem to recall that there might be an issue with Roth versus traditional IRA if you intend to retire outside the US. Anyone know anything about this?
Well, I would go farther and say that taxes should just be voluntary. Why should I be required to pay taxes, at all? That's what I read in my Ayn Rand novels in high school.
The tyranny of taxation!!!
That Ayn Rand was a real faggette wasn't she?
Che- Basically what you are saying is there will be no upside to me in this conversion just a lot more paperwork essentially the only benefit to the Roth, as far as I can see is tax free withdrawals and I have other vehicles that work better for me in my arsenal, I think that the Roth might work better for employees than for business owners I use a combo of SEPP and Keogh to shield retirement income and only pay on what I draw as income. The trust is better suited to my lifestyle and simpler to use efficiently as well as shielding my heirs from probate eventually and of course they will get the benefit of a stepped up value once it passes from me to my successors.
^^^ 25, please read again the statement of "non-deductible". The contribution is made where you do not take a deduction on your taxes, therefore no taxation is made from the conversion because you got no deduction to begin with.
What Che is speaking about are conversions from taxable accounts, like a 401k and traditional IRA where contributions into an Ira where deducted from taxes. This is where most people do a conversion such as yourself who maybe had no employer plan since you are self employed, your contributions where probably pretax and tax deductible.
However my situation above is an example for those people who maximize into an employer plan, SEPP, and are still able to contribute to an Ira. Even though you can contribute to an Ira you don't get the taxable deduction because you are considered an active contributor into your employer's plan (401k). Therefore the backside Ira contribution into it is non-deductible for tax purposes, and no tax is owed on conversion to a ROTH. This is different than a conversion from tax deductible Ira or employer plans where contributions are made pretax.
25 you now owe me $1500 for your lack of comprehension. This is my area of expertise and you failed to read what was stated. Trust me over all others and I will save you thousands in taxes over your retirement life span, hence my services are way less expensive than any advisor out at tie local brokers.
Your broker will charge you 1% based on your assets. If you have $1 million your broker will get $10k/year. My services beat the shit out of anyone you're using. Trust me. I'm a pro!
Thank you Meat your check is in the mail deposit on successive Fridays . P.S. I pay less than 1% to my advisor just FYI
"P.S. I pay less than 1% to my advisor just FYI."
And I bet he makes you feel real special that you're getting a discount, right? Start looking at fee based. It only makes sense. Why should he make more money just because you have more money? There should be a cap on how much you pay him annually. Does he work any harder the higher your balances are? You're the one doing all the work.
The reason why they're called brokers is because you leave broker than before you meet!
There are online calculators to estimate the pros and cons of converting an Ira to a Roth IRA. The cons are paying taxes up front to convert typically. That money could have been invested instead of paying taxes. You need to be careful when dealing with conversions of money because for example you withdrew funds from your 401 k and planned to roll o ER the funds into a rollover IRa but used some of the funds to pay taxes, the irs might treat the entire amount as a distribution and you could end up owing taxes on a very large sum, plus you might owe 10% penalties on top of the other taxes because of your age.
You could get hit with even higher tax bills with recent irs rulings if you convert more than one Ira per year. The big advantage to a Roth IRA is that your money grows tax free. You make 10% a year, then it compounds year after year, all those earnings can be withdrawn tax free after several years after 60 I believe. Earn 10% a year in a regular IRA, taxes will be owed on all of it. the calculators usually show online that if you expect tax rates to go up in the future, then you will be better off paying taxes now rather than in retirement. If you think Hillary or Bernie or someone might get elected, then you know taxes are going up.
If you realize that our government has almost 93 trillion dollars in infunded tax liabilities, then you might think no way is our government going to pay all that because they can't tax everyone enough to pay it. However a few Obamas and Hillarys and bernies could tax us to death. If you save all your life to accumulate a million or two by retirement then these clowns will say you're now rich and may tax you extra.
A Roth makes sense in all those cases because that will hopefully save on taxes. It only takes one president to remove the Ira to Roth IRA conversion and then that option will not be available, not even to the middle class who saved all their life in a 401k that they rolled over to a regular Ira.
It might not have been a reputable website (was it ZeroHedge where RickyBoy gets all his "knowledge"?) but I heard there was talk of only allowing people to buy treasuries in there 401k and IRAs. Buy them! Not even buy an ETF that shorts them!
FUCK YOI JACKIE