How would you like to invest for retirement tax free?An IRA, which stands for “Individual Retirement Account” is probably the easiest and most straightforward way to do that.But which IRA should you choose?The truth is… it depends on your unique situation…And making the right choice for you can make hundreds of thousands of dollars of difference, which means having more or less passive income to enjoy once you start taking money from your retirement account.In this video, I’m going to break down the differences between a Roth IRA and a Traditional IRA so you can choose which option is going to best help you have enough money for the future and be able to retire comfortably without having to keep working, if you don’t want to.The biggest difference that I want to highlight between the Roth IRA and the Traditional IRA is that:With the Traditional IRA, you get a tax deduction going in, you grow money tax free, and then you pay taxes when you take it out.With the Roth IRA, you don’t get a tax deduction going in, you still grow money tax free, and then you DON’T pay taxes when you take it out.If you start investing $300 a month at age 25, and you earn an average of 8% on your money, by the time you’re 65, you’ll have over $1,054,000.At that point, you’ll have invested a total of $144,000 of your own money. The other $910,000 is all growth.If you did this in a Roth IRA, you’d have to pay taxes on the $144,000 that you put in but you’d become a tax free millionaire and be able to take your retirement income tax free.If you did this in a Traditional IRA, you would have gotten a tax deduction on $144,000 that you put in, but now you’d have to pay taxes on one million and fifty-four thousand dollars.Would you rather pay taxes on $144,000? Or on $1,054,000?If you’d rather pay taxes on the $144,000 and take your retirement income tax free, then the Roth IRA allows you to do that.T. Rowe Price did a study that showed that the Roth IRA ends up being a better choice for almost everyone investing for retirement.If you make too much money to qualify for a Roth IRA, you can do what’s called a “Back Door Roth IRA.”High income earners like Dave Ramsey do this every year. They put after tax money into a Traditional IRA and then do a direct transfer roll over into a Roth IRA.Any money you can get into your Roth IRA will allow you to grow money tax free and take your retirement income tax free.But, depending on how close you are to retirement and what kind of a rate of return you’re getting on your investments, a Traditional IRA might still work out better for your unique situation.Now that you understand the main differences in how the Roth IRA and the Traditional IRA are taxed you can discuss your particular financial situation with a tax expert or financial planner and see which one is the best fit for you.=======================================[FREE EBOOK] The Financial Freedom Formula:https://realprosperity.isrefer.com/go/FFF/RPI/YTDiscover what it’ll take to become financially free so you don’t have to depend on your business, a job, the government, a partner, or anyone else for money.=======================================Claim your FULL SCHOLARSHIP (Valued at $497) to the Financial Freedom 101 Online 3-Day Event: https://realprosperity.isrefer.com/go/scholarship/RPI/YT=======================================Let’s Stay Connected! This page links to all my social media sites:http://www.PenelopeJaneSmith.com=======================================LIMITED TIME: Get 2 FREE STOCKS ON WEBULL when you deposit $100 (valued up to $1850 each):https://act.webull.com/vi/S3LGNcqjyQP1/474/inviteUs/recommend_1531_A_push=======================================GET UP TO $250 WORTH OF BITCOIN FROM https://blockfi.com/?ref=b33d7af5=======================================[VIDEO] 3 Surprising Tips to Retire with An Extra Million Dollarshttps://youtu.be/_spHeUfnPWI=======================================NEW! Join Penelope’s Prosperity for Life Program: https://realprosperity.isrefer.com/go/pfl/RPI/YT=======================================NOTE: Penelope Jane Smith will receive an affiliate commission or referral bonus from some of the links and other products that appear in this video. Penelope Jane Smith is part of an affiliate network and receives compensation for sending traffic to partner sites. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available.
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Most investors use the terms volatility & risk interchangeably. This is a big mistake; they are not the same thing. Understanding the difference will go a long way toward becoming a great investor!If you like the outro music, check creator here: https://www.youtube.com/channel/UC_qPXspaErcz5ge1GjVH1DwWorkload permitting, you may hire him to make you custom music.Most people look at volatile stock charts and assume risk. It’s impossible to know for sure whether or not a business is a risky investment by looking at the stock chart alone.Let’s say stock 1 goes up 3% in year 1, 20% in year 2, and 10% in year 3. Another stock goes down 10% in year 1, 10% in year 2, and 10% in year 3. Hurray! Stock 2 has zero risk because there is no volatility! This example should show you that risk ≠ volatility.Roughly speaking, there are two general factors that determine whether a stock is a good buy: The Core Business & Valuation. First, let’s tackle understanding the core business.Does the company have strong brands? How long has it been around? How easily can market share be taken from competitors? Are there barriers to entry in the industry? Does business have few, large customers? Or many, small customers? Does it operate in a growing industry? How likely is the industry to be disrupted by competition? Does the industry have large or small profit margins? Does it generate revenue via subscriptions? One time purchases? Pay-as-you-go?One of the best parts about being a retail investor is you can use your own intuition and observation to help find good companies. It’s not a good idea to invest in Nike because you like their shoes, but we can often discover potential investments by observing the world around us. Peter Lynch–one of the best of all time–mentioned he got investment ideas from what his wife and daughters brought home from the store. Understanding a business is all about knowing where it is today, where it is headed in the future, and recognizing potential risks along the way.The second component is Valuation. Valuation is a fancy way of saying “how expensive” a stock is. Let’s say we are at a store and we are going to buy some beef. Someone says, “hey this beef is cheap, it’s only $5!” Meaningless! $5 relative to what? $5 per ounce, pound, gram, kilogram? Valuing stocks is very similar. Let’s say a stock price is $50. $50 per what? We need to compare stock prices to a relevant metric.Two common ratios used to value companies are P/E and P/S. Dollars I pay for $1 net income or $1 in sales (revenue). As you can imagine, valuing stocks is more complicated than valuing beef, so there’s more that goes into it, but at a basic level, this is all there is to it.To recap, the first factor is knowing the business, where it is now and where it’s going in the future. The second factor is valuation–how much you’re paying for each dollar of profit or dollar of revenue.*Tune into the video for an example to clarify these concepts!There’s 10,000 different distractions out there, but at the end of the day, these are the two things you’re trying to figure out.So, when a stock has a volatile price, but the business is solid and priced well, we know there is low risk. As individual investors, THIS is what we’re trying to find. Strong companies that are mispriced. If the stock is volatile, great! We know it’s low risk, so we’re glad it’s volatile and can buy shares at low prices. Also, if you understand that you’ve insulated yourself from risk by purchasing a solid company at a good price, it will be much easier to stomach stock price volatility.All of what I’m saying assumes you’re willing to hold a stock until the market prices it fairly. It could be months–or even years–until this happens. But if you’re willing to hold, there’s limited risk. However, if you’re into short term trading, the rules are different. Volatility is a reasonable indicator of risk.Final note: Just because risk and volatility are not the same thing does not mean they are completely uncorrelated. Unprofitable speculative stocks are often volatile. They are also risky. It is up to each individual investor to determine an investment’s risk level.DISCLAIMER: The topics covered in this video, and my others, are opinion and should not be considered financial advice. This channel is for fun and entertainment only. Be sure to consult with a professional investment advisor before making financial decisions.#StockMarket #RiskManagement #StockVolatility
Pete the Planner reviews the pros and cons of investing in an annuity. Learn more about investing at http://www.oneamerica.com/today.
Pete shows how the demand for your retirement income affects the amount of income you need.
Importance of Starting Early
Building a portfolio that gives you opportunities to grow your savings and have a level of protection during downturns can be a challenge — but it’s possible with Lincoln Level Advantage indexed variable annuity. The 1-year performance trigger is one of several indexed account options available. To learn more, visit http://www.lfg.com/LevelAdvantage
Pete discusses the importance of taking advantage of an employer match. Learn more about preparing for retirement at http://www.oneamerica.com/today.
Pete provides a basic overview of retirement planning. Learn more about preparing for retirement at http://www.oneamerica.com/today.
Pete provides some things to consider when you are thinking about taking a loan from your retirement account. Learn more about preparing for retirement at http://www.oneamerica.com/today.
Pete illustrates the retirement income streams available and how your employer-sponsored retirement plan fits into your retirement preparation.
You’ve probably heard the phrases “term insurance” and “permanent insurance” before, but what do they mean? How are they different from each other? Well, allow us to explain.You can learn more about us at http://www.oneamerica.comFor more financial education resources visit https://www.oneamerica.com/financial-education