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Roth IRA vs Traditional IRA

Most potential candidates for our Affordable Housing Partners Group come to us already having a traditional IRA. A few come just with funds locked up in a Certificate of Deposit, others with “lazy” cash lying around in a non-interest earning account.

I educate others on the  benefits of having a Roth IRA…that’s what I’d like to just touch on today.

For those that already have a traditional IRA, it’s my opinion that one of the most powerful moves one can make is to do a Roth conversion…especially if someone is contemplating becoming one of my Passive Private Money Partners.

A Roth Conversion Is When A Traditional IRA Is Converted Into A Roth IRA

Generally, assets held in traditional IRAs are subject to ordinary income tax upon conversion or withdrawal.

As you know, Private Money Partners provide all the funding so that I can purchase real estate and in return for the use of their capital I pay above average rates of return.

Thus, I teach tax saving advantages every chance that I get so that they can keep the profits earned versus giving a slice of it to Uncle Sam.

Roth IRAs are attractive accounts because they provide completely tax-free growth and distributions.

I explain it like this: converting a taxable traditional IRA to a Roth IRA is similar to paying tax on the seeds so the future harvest can be reaped tax-free.

********************************* If you are reading my blog for the first time, let me inform you that… My company buys single-family houses and I write this blog bi-weekly which is primarily directed to educate 1 group of individuals:

Individuals who are losing their shirt as a result of the “roller coaster” volatility of the stock market and low paying rate of other traditional investments, i.e. people that are looking for an opportunity that’ll provide a secured place to put their money to get it working for them to earn better than average returns.

However, often times, homeowners that need to sell their house, stop by to take a peek because they are curious and wondering how and/or where we get the funding to purchase houses. And if they stick around long enough, they begin to understand why individuals partner with us to provide the funding which empowers us to be able to purchase real estate on a continual basis. Simple, it’s because we teach them a secured way to earn better rates of return than they are currently earning.

Request your FREE Education Kit if you are interested in learning how passively investing in real estate may help place you in a better financial position.

DisclaimerThis site is intended for educational purposes only. I am not an accountant, attorney or licensed financial planner. While the information I’m writing here is based on many years of experience buying houses that doesn’t really constitute professional advice (since everyone’s experiences and situations are different).

Managing Partner