4 Retirement Savings Hacks You Should Know!

Four practical retirement savings hacks include funding a Roth IRA from a brokerage account, prioritizing Roth IRA over-contributions, understanding 401k loan benefits, and diversifying retirement account investments beyond the stock market.

• Fund Roth IRAs from brokerage accounts for tax advantages.

• Prioritize Roth IRA for over-saving due to flexible contribution withdrawals.

• Utilize retirement accounts for diverse investments beyond traditional stocks.

Financial strategies for retirement savings can optimize tax advantages and investment flexibility. Key hacks include contributing to a Roth IRA directly from a brokerage account, allowing for potential tax loss harvesting. Over-saving into a Roth IRA provides the benefit of penalty-free and tax-free withdrawal of contributions if funds are needed later.

Roth IRA Contribution Strategies

• 00:00:00 A Roth IRA contribution can be made from a brokerage account, not exclusively from a bank account, potentially enabling tax loss harvesting simultaneously. Additionally, if an individual over-saves into a Roth IRA, contributions can be withdrawn tax-free and penalty-free without scrutiny, making it an ideal account for prioritizing excess savings.

Retirement Account Flexibility

• 00:00:51 Borrowing from a 401k is not inherently detrimental, as the interest paid on the loan goes back to the borrower, and the transaction does not impact one's credit report or incur an immediate tax bill, provided the funds are used for sensible purposes. Furthermore, once a Roth IRA or other retirement account (excluding 401ks/403bs) grows, its funds can be invested in a wide array of assets beyond the stock market, such as real estate or private businesses, though certain collectibles like art or antique cars are excluded.