What's up, you guys? It's Graham here. So today, I'm going to make a video about what a Roth IRA is and why it is so important to sign up for one of these things as soon as you can and put money in it as soon as possible. Now, this is one of those videos I recommend you do not click out of. I highly recommend you watch it all the way through because it's that important. I totally regret not doing this when I was a lot younger, just like me not getting a credit card when I turned 18. Me not signing up for a Roth IRA when I was like 16, 17, 18 years old, in my opinion, was a huge mistake. And if you guys could learn from my mistakes, all the best. So that's why I highly recommend you watch this entire video. I'll be explaining exactly what it is and why it's so important. This is also the type of video that's going to make all the time you've spent on YouTube so far completely worthwhile, which means that all these cat videos you've watched, all these stupid fidget spinner videos you've watched, all these thousand-degree knife challenge videos you've watched, they're all worthwhile because this video is that important. Like, you have the chance to make hundreds of thousands of dollars tax-free just by opening up a Roth IRA and contributing to it. Just to give you an example of the power of compound interest and investing as early as possible, if you're 18 years old and you invest $1,000 in a Roth IRA, by the time you're 60 years old, that $1,000 is going to be worth $17,100 adjusted for inflation. Now, by the same example, if you invested that same...
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How does a simple ira grow Form: What You Should Know
How a SIMPLE IRA Grows — Budgeting Money — The Nest The contribution limits in a SIMPLE IRA depend on how much money you put into the account. Your contributions are reduced in a percentage of your pay. How a SIMPLE IRA Grows — Finance — The Nest For the first 50 per month of your salary, you can contribute a maximum of 5% of your salary. For a further contribution each month you can How a SIMPLE IRA Grows — Finance — The Nest You may pay taxes on your dividends and capital gains earned on investments in an IRA as they become part of your taxable income. But in most cases, you will not be taxed on your contributions. What Happens if You Fail to Meet Your Contribution Limits? If you don't pay enough in contributions, you'll pay a 10% early withdrawal penalty. If you fail to meet your contribution limits for at least seven consecutive months, you'll be subject to a 50% penalty. SIMPLE IRAs Offer Low Fees — Budgeting Money — The Nest There are other retirement accounts with low fees. For example, your broker will charge you a small 0.20% to 0.25% fee every year for transferring your IRA holdings to another account or to another IRA. What About Tax-Effective IRA? Simplified plan, as well as other retirement plans — such as 401k (retirement plan for employees of companies with more than 200 members), 403(b) (plan for employees of companies with 50 or more members) and other IRAs — are all tax-efficient in part because the accounts are structured to make tax treatment on your investments easy. You may also consider a tax-efficient IRA. These are IRA accounts, typically tax deferred, but you can transfer holdings onto other IRA accounts, creating tax-efficient portfolios. You can still make the same contribution to an IRA that's designed for tax year 2023 without a penalty. Instead of paying in an extra 3%, you would pay the usual 3% early withdrawal tax instead. Simplified plan IRA Offer Low Fees — Budgeting Money — The Nest The Simplified plan, by design, comes with no fees. You don't have to pay an additional 0.08% early withdrawal tax on your account deposits or transactions.
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