Future Income/Investment

[Aakupaccha_caradu1]

6 minutes ago, Android_Halwa said:

Jawani la retirement alochanalu enduku kaka...paisal tarvata aina kamainchukovachu, jawani karchu aipothe malla raadu vaa...enjaaaay kaka enjaay..settlement, retirement gurinchi ipude fikar petukunte etta vayya

@HalwaBSDK

[AFDB_Director]

15 minutes ago, jai_bali said:

mari 26k ante too much aitadi kavvachu...condo anukunna friend thoni kalsi teeskundaam ani but as u said job long term oo kaado teliyadu..but have to think abt that..maa frnd gaadu full time..may be his place lo invest cheyyochu

Atleast start with Roth IRA. You will have 1 million if u start now and invest just 6k every year until retirement. 

I would strongly suggest against buying a condo with friend. I usually don't mix friends and business. Either u will end with no money or no friendship.

[idibezwada]

1 hour ago, AFDB_Director said:

I can't comment about rental or business ideas but here is where to start:

- 6 months emergency fund in savings

- maximize 401k ($20k per year)

- maximize Roth IRA ($6k per year) 

- invest in housing, may be a condo if ur job is stable or if u can stick to same city for atleast 5 years. 

Your age is your advantage. Wish I was matured enuf to think about savings in my 20s. But age and compound interest are your best friends as of now! 

 

 

 

companyrtho 401k undi and if he is more than 75k roth ira contribution deductabe kadu..aite isnt it better to opt for traditional ira than roth?

[jai_bali]

I am planning to go with 401k(traditional) as suggested..Have to look into other sources/savings..but I think that will be a good start..

[LadiesTailor]

13 hours ago, jai_bali said:

mari 26k ante too much aitadi kavvachu...condo anukunna friend thoni kalsi teeskundaam ani but as u said job long term oo kaado teliyadu..but have to think abt that..maa frnd gaadu full time..may be his place lo invest cheyyochu

Buying and renting is a pain in the but when you are not local..... don’t always count on friends no matter how close they are..... 

if you want to live in a condo or any other home go and buy it.... if you move out of the area you can sell it or rent it...

if you want to go with friends make sure to have a clear idea on sharing your tasks... future lo problems raakunda 

[AFDB_Director]

12 hours ago, idibezwada said:

companyrtho 401k undi and if he is more than 75k roth ira contribution deductabe kadu..aite isnt it better to opt for traditional ira than roth?

You can do a backdoor Roth if your income is high. Any brokerage like vanguard or similar will do it if you have high income and not eligible for roth IRA. 

[idibezwada]

9 minutes ago, AFDB_Director said:

You can do a backdoor Roth if your income is high. Any brokerage like vanguard or similar will do it if you have high income and not eligible for roth IRA. 

so whats the advantage of it?

[AFDB_Director]

7 minutes ago, idibezwada said:

so whats the advantage of it?

you will pay taxes later for Traditional IRA.

You will pay taxes now for ROTH and the withdrawals are tax free at retirement. Also, early withdrawals are much easier with ROTH. 

You can read the differences and advantages of ROTH on any good financial forum or blog to understand better. 

[idibezwada]

9 minutes ago, AFDB_Director said:

you will pay taxes later for Traditional IRA.

You will pay taxes now for ROTH and the withdrawals are tax free at retirement. Also, early withdrawals are much easier with ROTH. 

i have nondeductible funds sitting in my traditional ira..i called my broker yesterday and asked what would be the taxes and penalities if i move the funds to roth and withdraw them say in 10 yrs..he said the principal amount will be tax free and the earnings will be taxed with penalty 

[AFDB_Director]

23 minutes ago, idibezwada said:

i have nondeductible funds sitting in my traditional ira..i called my broker yesterday and asked what would be the taxes and penalities if i move the funds to roth and withdraw them say in 10 yrs..he said the principal amount will be tax free and the earnings will be taxed with penalty 

Non deductible funds antunnav ga. That means you are not taking tax deduction on them while filing taxes? Then what's the advantage of keeping them in Trad IRA? Ur earnings will brle taxed, you are not taking deduction on principle. Better option is RoTH then. 

[idibezwada]

32 minutes ago, AFDB_Director said:

Non deductible funds antunnav ga. That means you are not taking tax deduction on them while filing taxes? Then what's the advantage of keeping them in Trad IRA? Ur earnings will brle taxed, you are not taking deduction on principle. Better option is RoTH then. 

this is what happened...i dont have 401k from my employer...my wife has 401k...so i moved $6k to each to our traditional IRA accounts..now while filing taxes its only allowing the 6k from my contribution as deductible and saying my wife exceeded the MAGI limit and not allowing to deduct the 6k from her Traditional IRA account and its becoming nondeductible amount...now if i move the funds to her ROTH IRA, broker is saying all the principle will be tax free but earning will be taxed in addition to penalty for early withdrawals...usually if its a regular brokerage account, for the earnings i will be only charged taxed right? now for ROTH its tax+penalty...i dont understand why you are saying roth would be a better option...not sure if i am missing something here