On this episode of Adam Talks, Adam Bergman, Esq. discusses strategies on how to use Roth sub-accounts for your IRA or 401(k) to enjoy tax-free retirement money.
Live Off Your IRA or 401(k) Tax-Free! – Episode 425
On this episode, Adam Bergman discusses strategies for living off retirement funds tax-free, focusing on utilizing Roth IRAs. He explains how individuals over 59.5 years old with a Roth IRA can withdraw money without tax if the account has been open for at least five years. One method is to invest in passive income-generating assets, like real estate or stocks, within the Roth IRA. Another approach involves using a Self-Directed Roth IRA to invest in a private business, allowing tax-free dividends to be received by the IRA.
Furthermore, Bergman introduces the concept of a ROBS (Rollover for Business Startup) where retirement funds can be used to invest in a business controlled by the individual. Through this strategy, dividends from the business to the Roth IRA can be received tax-free, providing a means to live off tax-free income. Bergman emphasizes the importance of time in building retirement wealth, highlighting the power of compounding returns and encouraging individuals to start planning and saving early to maximize their retirement funds.
He acknowledges that while the strategies discussed are most beneficial for individuals over 59.5 years old with a Roth IRA, younger individuals can still prepare by building up their retirement accounts and setting up a Roth IRA for future tax-free withdrawals. Additionally, Bergman mentions the possibility of converting pretax IRAs or 401(k)s into Roth accounts, albeit with tax implications. Various strategies, including discounted valuations and investment opportunities, can be utilized to offset potential taxes on conversions.
The importance of proper planning and structuring of Self-Directed IRAs is highlighted throughout the episode, with Bergman offering specialized products and solutions tailored to different types of investments. By combining the benefits of the tax code with retirement rules, individuals can create structured designs to generate tax-free wealth in their later years. He expresses a passion for sharing knowledge and helping individuals achieve tax-free living in retirement, emphasizing the value of understanding the rules and taking a patient approach to long-term wealth accumulation.
In conclusion, this week’s episode stresses the potential for tax-free living through strategic retirement planning, particularly with Roth IRAs, and the benefits of leveraging the tax code to create tailored solutions for individuals. Bergman encourages listeners to leave positive reviews to help share the knowledge with a wider audience and reiterates the satisfaction derived from designing plans that enable tax-free wealth accumulation. Overall, the podcast serves as an informative guide on utilizing retirement funds effectively, navigating tax implications, and maximizing wealth growth over time through strategic financial planning.
