Investing the right way
I often encounter questions about the best strategies for managing retirement savings. One common query is whether employees should transfer their 401(k) savings into an Individual Retirement Account (IRA) after retiring or switching jobs. The short answer is yes, and in this article, I will explain why this is generally a smart move for most people. I will also discuss the benefits of an IRA, the process of transferring your 401(k), and some potential pitfalls to avoid.
For many individuals, saving for retirement is a top priority. One popular savings vehicle is the Roth IRA, known for its tax-free growth and withdrawals. However, not everyone is eligible to contribute directly to a Roth IRA due to income limits. Enter the Backdoor Roth IRA and Mega Backdoor Strategies, which provide high-income earners with an alternative path to tax-advantaged retirement savings. In this article, we’ll explore these strategies, their benefits, and potential pitfalls.
I frequently get asked about investment options that parents can establish for their children. It’s an important question, and there are several options available. In this article, I’ll compare and contrast some of the most popular types of investment accounts for children that parents can set up. For this exercise, I’ll focus on 529 plans, UTMA/UGMA accounts, Roth IRAs, and regular taxable brokerage accounts.
The past 50 years have seen incredible advances in investment accessibility for average Americans. With the development of simple indexed mutual funds in the 1970s, average investors gained access to the equity and bond markets that had traditionally only been open to wealthy families and institutions. Further innovations such as ETFs, retirement savings vehicles, and online banking opened the gates even wider. Today, average investors by and large play on a level field with even the wealthiest among us. Yet, because of poor personal finance management, many middle and working class families are missing out on their full retirement potential.