Take Advantage of a Roth IRA

Senator William Roth, the inventor and sponsor of the Roth IRA provided you with an opportunity to have full choice as to where, how, and when your IRA contributions would be invested.

This is generally very different from a regular IRA where your company or IRA plan may restrict or prohibit investment choices.

Roth IRA contributions are after tax income, but the primary advantage of a Roth IRA is that your withdrawals are tax free. The account has to have been in existence for five years though.

You and your account custodian or trustee can work in concert to maximize your investment income strategy. The custodian takes care of legal aspects of IRA management, but you get to make the investment choices.

Your investment choices will depend on market conditions, diversification, and your risk tolerance. Careful research, verification of all information, and establishing a relationship with recognized and credentialed professionals is always best.

Unfortunately, there are too many others out there that would only be too happy to take your money.

Another advantage of a Roth IRA is that once money is put into the account, it is never taxed again. Dollars withdrawn during you retirement are not taxed.

There are many self-directed Roth IRA advantages but a very small percentage of people who own IRAs prefer to do so. They prefer the convenience of permitting others to invest their money.

This of course doesn’t always guarantee wise investment strategies and it certainly involves a degree of trust. The ‘my choice’ advantage of a ROTH IRA greatly expands your influence and input as to how your dollars are invested.

Hopefully these choices will dramatically enhance your earning potential. Yes there is risk, but there is with most investments. The difference between a regular IRA and a self directed Roth IRA is simply this. You can change your investment amounts and options as markets fluctuate.

Remember my caveat of research, verify, and analyze before making investment changes-get professional perspective. It is your money and your retirement.

Other Roth IRA advantages: withdrawals of earnings are tax free when the account owner reaches the age of 59 ½. There are also withdrawal provisions if the owner becomes disabled.

Lastly, your direct contributions can be withdrawn at any time without encountering a tax issue.

Let’s say you already have a qualified retirement plan such as a 401K. Another advantage of a Roth IRA is that you can also make contributions to your Roth as well as your 401K.

Be careful though as the maximum amount you can contribute to all your IRAs is limited by the federal government and may also be limited by your income and tax filing status.

One investment strategy for self directed Roth investments that is rapidly emerging is real estate. Some invest merely to own rental income property. Still others are investing in community development projects.

Many people are discovering the benefits of turnkey investment companies that will invest your money into real estate and relieve you of all the burdens of actual ownership.

This market is particularly appealing given current bargain basement real estate prices.

Explore if these Roth IRA advantages can contribute to your investment and retirement plans that will provide you with a retirement that you deserve.