The Best 401(k) or IRA Rescue
This Time magazine article from October 2009 clearly explains why 401(K)’s are essentially a failure. They stated, “The ugly truth, though, is that the 401(k) is a lousy idea, a financial flop, a rotten repository for our retirement reserves.”
Let’s do some simple tax math and the numbers make it clear that tax free is the only way to go. Roth IRAs have limitations on what you can contribute. Your AGI (Adjusted Gross Income) limitation for your maximum Roth IRA contribution are
- $184,000 for a Married Individual Filing a Joint Return
- $117,000 for all other Taxpayers.
If you are in California, you will pay 90% (total taxes and early withdrawal penalties) after 2022 if you need to access funds in your 401(k) before age 59 ½. Click here to see the Math & Proof.
You can also see that in Florida, Texas, New York, Pennsylvania and Illinois the taxes and early withdrawal penalties are in excess of 72% if you earn and personal income (AGI) above $416,000. Click here to see the Math & Proof.
The problem with a Roth IRA is you are still under the purview of Government and they have the power to change the rules of Qualified Plans anytime they like. The table below shows you what your funding limits are with a Roth IRA, whereas, the solutions we recommend is one in which the US Supreme Court has ruled on twice and made it clear that a private contract entered into in good faith that was legal at the time is NOT something government can amend or alter after the fact.
209-814-6865 | JLM@BankingLikeTheRich.com
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