19 Oct How to Build Millions with a Roth IRA: 4 Important Questions Answered
Here’s a word to never use again… retirement. Here, we call it your “freedom day”.
Because you may stop actively working when you retire, but that doesn’t mean you stop earning. It’s your freedom from working for active income, but your passive income streams should continue to generate cash flow and increase your wealth, day in and day out for the rest of your life.
The secret to building your wealth so you can celebrate your freedom day sooner rather than later, begins with controlling your investments and letting your money work for you without entrusting it all to an outside organization, establishment, or bank.
In Other Words, You Open Up a Roth IRA
Also known as a self-directed IRA, it’s the hidden weapon of the wealthy. This is because a Roth IRA is the one type of account you can safely say that you are in control of. How you build your wealth via this particular account is completely up to you, which is also why you’ll want to schedule afree, guided Gap Analysis strategy session with one of our wealth-building and investing experts to help you strategize and get set up correctly.
But before you start to design your Roth IRA strategy, it’s crucial you know the answers to the following 4 important questions…
1. Are Roth IRAs Limited to Stocks, Bonds and Mutual Funds?
Nope! In fact, one of the biggest bonuses of a Roth IRA is that you’re fairly unlimited on what you can invest in. Such as:
- Real Estate
- Private Businesses
- Sky’s the Limit
Hence you get more creative opportunity to build your wealth.
2. What Are Some Examples of Investments You Can Put Into an IRA?
- An old 401K from a previous employer
- Health savings accounts
- Educational savings accounts for your children
In other words, think back. That helps you think forward as you get all that money off of Wall Street. Start from the very beginning…
Say you’re getting professional pictures done with your infant child, for instance. Instead of just paying for it out of your own “pocket,” per se, instead issue a 1099 for a Roth ‘seed’ at a limit of $5.5K, and before you know it when your child’s an adult, at a 10% growth rate in that IRA, your future family will have well over $2.5MM in tax-free income.
That just gives you a taste of the potential of a self-directed Roth IRA.
3. What Are the Major Benefits of a Roth IRA?
- Tangible assets like gold will work just fine
- Real estate works great when you purchase a home in the name of your IRA
- You can even be a lender with a functioning Roth IRA and earn interest
- Certain family members are allowed in doing ‘business’ with
- Zero-cost capital if you’re a business owner (you can take a loan out and pay yourself back)
4. What Can You Not Do With a Roth IRA?
Very little. But you still need to be aware that generally speaking, with relation to the tax code, life insurance policies and collectibles (artwork, for example) can’t be included. You also can’t fund yourself in a business deal. And the only family member you absolutely can’t do business with in a Roth IRA is your spouse.
With a Ton of Benefits and Not Many Limits, a Roth IRA Is Very Much Worth It
Just look for the right licensed custodian. Invest in what you know and love. Find innovators. Focus on your passions and let those investments grow in your retirement account. Bear in mind that there are the standard set-up fees, annual costs and other transaction expenses, but you might even be fortunate enough to discover a plan that offers a flat fee of $250 annually.
In the long run, we’re talking about massive long-term profits. Just make sure you get an expert to help you strategize your Roth IRA and make sure you’re on route to building multi-million-dollar wealth.
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