15K ROTH IRA What Will You Do?
What will you do if you have 15K Roth IRA? I have no experience in creative financing/tax liens/rehab.
What will you do if you have 15K Roth IRA? I have no experience in creative financing/tax liens/rehab.
My understanding of a Roth IRA )from my husband who is an investment broker) is that a Roth IRA can be taken at any time. You paid taxes on the money before you invested in it. There are no penalties for taking it out in any amount. Beyond that, I can't answer. I would hope that before you use your retirement money you are certain that the investment you are planning to make is a sure thing and will give you a high return.
Advice would differ depending on your age. But in general, that's a fairly small IRA. You're better off continuing to invest in it. In fact, as Roth IRA's have no minimum distribution requirements, you should leave assets in a Roth IRA to grow the longest. In other words, Roth IRA's should be the last retirement fund that you tap.
Hey,
There is a 10% penalty for withdrawing from a Roth IRA before the age 59 1/2, unless it is YOUR first home or college use.
You could transfer the money to a different IRA vehicle and, inside that structure, invest in Real Estate.
But it that really a good idea???
You already stated that you have no experience with RE. Should you be gambling with your retirement money?
I put my IRA money in to a good index fund.
i would leave the roth ira in place. study the area of interest that i was interested in first {c/f, tax liens, rehabb. ect.} then pursue with full knowledge of my investment. don't invest your "hard" earned money unless "you" know what your doing first........kenmax
Kenmax
Gaining the education and knowledge before you jump in -
What are the best resources to get this education from - Who's teachings are the ones to go with
My understanding is that by now any ROTH IRA won't have too much money in it 'cause it was only 1996 when Clinton Administration passed it. The maximum contribution amount can only be $3000 for a single, or $6000 for a couple if they "luckily" fall into the bracket. So there's no way to compare it with a well-contributed 401K account that has been in existence for many years.
Hey,
Someone could have rolled an IRA into a Roth IRA, so the sky is the limit to how much someone can have in a Roth They would have paid tax on the transferred amount, but all the money in the Roth is tax free (after 59 1/2).
You can't compare a 401k and an IRA. Generally speaking 401k have some degree of matching contributions and a limited number of investment options. All things being equal, the total return on a 401k blows an IRA away. The IRA exists to allow people who are NOT covered by a 401k a retirement vehicle. While it is possible to invest in both, it generally does not make sense.
Just to clear something up here. There is a penalty and taxes if you take out a "Traditional" IRA before age 59 1/2. The Roth IRA allows you to take out all of the money you invested without any penalty or tax. That is one of the reasons why a Roth IRA is a good idea. The other reason is that you pay no tax on it when you take it after retirement. The 401K as well as the traditional IRA does have tax consequenses as well as penalties. What you can't take out is the interest (the gain) on your ROTH. You have to leave that alone. I believe Bruce has erred on several points including his opinion on an IRA vs. 401K. Employers don' always offer matching funds. A qualified investment broker or CFP may be helpful to you. There are also what are known as self directed IRA's where you can actually purchase Real Estate within your IRA plan. This is a very specialized area and you would have to find a brokerage firm that does this. The way that would work is that you would be able to use the money to purchase Real Estate and still leave it in your retirement plan.
Find someone who does truely self directed IRA's. If you were doing L/O or Sub to's. you could use your Roth to buy as many as you could afford.
Example
House worth 139K
owed 111K
monthly 786
mo income 1050
all of this was done in a Roth secured for $10 and made one payment. Education is your alley. Learn how first before you jump. It can be done. Then look for a Roth that can do different type investing.
Besst to you
Sire[