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Anonymous
2016-07-11 03:35:46 Post No. 1373826
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Anonymous
2016-07-11 03:35:46
Post No. 1373826
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So people keep telling me to invest in a Roth IRA, which is after-tax, but this just sounds retarded
1. The only reason is: they say that later I'll be in a higher tax bracket, so it's better to pay the taxes now. This makes no sense though, when I'm retired I'll be making like $0/year, won't my gains tax be minimal?
2. Tax-deferred is significantly better than taxes now; $1 of tax now equal $7.04 of tax 40 years away when assuming a 5% interest rate--which means paying $1 of tax now and $7.04 of tax later is equivalent, but I highly doubt my tax charge in 40 years will be 7x what it is now
Am I missing something? Is a Roth IRA only good if I plan to withdraw early/while I have an income?
Also how much are you guys putting in your 401(k)
