Roth IRAs can be tough for some to understand and admittedly they are a bit different than the normal offered 401k and Roth but that doesn't mean they have to be feared. Roth IRAs can be incredible investment vehicles and to neglect having one is to leave money on the table and nobody wants that! That'd be like being offered twenty extra bucks from grandma and saying no. How could you not?
In the above video I have tried my best to explain the cost and benefit to opening and managing a Roth IRA but I will try to lay it out in even more simple terms here. This way nobody can claim that they couldn't get my message on account of their ears being stolen by a pack of hungry wolves.
Roth IRAs have numerous advantages but they also have limitations. For one, if you are under the age of 50, you are limited to placing $5,500 annually (aw shucks!) and if you're over 50, you are limited to adding $6,500 annually. This however is a small draw back to the gains that can be made and let's be honest, everybody wants the gains... bro?
In addition to the limitations on what you can contribute, you are also limited on what you can take. That means limitations on when you want to grab some of that hard earned cash and run out to the
strip club baby shower for your niece. Yes, that's right. You'll have to know a few rules first before you can be chucking one dollar bills at the friendly girl (or guy) that's trying to put themselves through college favorite aunt of yours!
Contributions made into the Roth IRA are available to be withdrawn whenever. Capital gains on those contributions however are subject to additional taxes if you aren't careful. The government will let you have your capital gains scat-free if you qualify under certain exclusions. These exclusions include but are not limited to these funds being used for student purposes, home purposes, hardship purposes, or if you're above the age of 59 and half. If you're interested in knowing exactly how to qualify for these or to get more information on them, please contact your friendly neighborhood IRS agent and they will be happy to
steer you away show you.
That's it for me though, folks. I'm out of time and out of energy. Until next time!