Financial Planning, Tax Planning

How to Use The Mega Backdoor Roth Strategy

The Mega Backdoor Roth is a common planning strategy for high income earners looking to allocate money to Roth accounts. In most cases, their income exceeds the contribution threshold, which disqualifies them from making Roth IRA contributions. High-income earners can circumvent the income limitations by utilizing the Backdoor Roth strategy. While the backdoor Roth gets… Continue reading How to Use The Mega Backdoor Roth Strategy

Financial Planning, Tax Planning

The Trojan Horse of IRAs – The Backdoor Roth

In RCs and I Ain’t Talking Cars, I explained what a Roth conversion is, how to complete the process, and why you may want to consider it. But I didn't talk about the backdoor Roth. While it's technically a Roth conversion, the execution is slightly different. If you’re unfamiliar with the differences between Traditional IRAs… Continue reading The Trojan Horse of IRAs – The Backdoor Roth

Financial Planning, Tax Planning

Traditional or Roth – Which Should I Choose?

One of the most frequent questions I hear from investors is ‘should I contribute to tax-deferred accounts, like a Traditional -401k, Individual Retirement Account (IRA), or Simplified Employee Pension (SEP) or should I contribute to my Roth -401k or IRA?’ Before we get there, let’s do a quick refresher on both options. Tax-Deferred Accounts You… Continue reading Traditional or Roth – Which Should I Choose?

Financial Planning

401(k) Loans – Are You Really Paying Yourself Interest?

When someone is looking at lending options, occasionally their 401(k) is one of them. Why wouldn’t you take a loan from your 401(k); you’re technically paying yourself interest, right? Unfortunately, it’s not that straightforward. In most cases, an investor can distribute money from their 401(k) as a loan. The loan value can be up to… Continue reading 401(k) Loans – Are You Really Paying Yourself Interest?

Estate Planning, Financial Planning, Tax Planning

How the SECURE Act Could be Detrimental to Your Beneficiaries

Many people own a trust as part of their estate plan. Prior to 2020, it was common to have the beneficiary of an IRA be a trust. A See-Through Trust allows individuals to pass IRAs, via a trust, to their trust beneficiaries. There are several reasons to name a trust as the beneficiary of an… Continue reading How the SECURE Act Could be Detrimental to Your Beneficiaries