In the last post we talked about how everything we have been taught regarding the residential finance process isn’t working. Over the next five weeks we will be talking about the 5 Phases to achieve Financial Success.
The IRS and Congress have eliminated the limits on how much you can earn and how much you can have in retirement accounts before you can convert.
Little does anyone know, you can convert any amount of money to a ROTH IRA.
The reasoning behind this idea is to convert the money now. Pay taxes on it now. Let the account increase in value and withdraw the money later on without having to pay taxes on it.
What is a Roth IRA?
If you are not familiar with a Roth IRA, it is a retirement account where you invest after-tax dollars, and withdraw the funds tax-free. In other words, you invest your money in the retirement account after you have paid taxes on it. Being that you paid taxes on the money before you invested it, you do not have to pay taxes when you withdraw the funds from the Roth IRA.
Here are some tips and strategies that save you money when you are in the market to refinance your home loan:
- Don’t get caught in the trap of consuming your home equity by getting deeper into debt to go on vacation, purchase unnecessary items and spread out your car loans and credit card balances over 30 years. As a Certified Mortgage Planner, I help you implement viable refinancing strategies to conserve your home equity, build greater wealth and achieve your goals in life.
- Understand that you may need to pay higher fees or interest rates if you are getting cash out of your home equity vs. simply paying off the current balance. Also, you may lose the interest tax deduction on cash-out funds in excess of $100,000. I am able to help you structure your refinancing transaction to give you the best overall financial impact for your individual circumstances.
- I will help you evaluate the mortgage products that will work best in your situation. Remember, it is far better to implement the best strategy with competitive interest rates than for you to shop for the lowest rate with the wrong strategy.
- Know your credit score! You may be able to get a better mortgage rate and more favorable loan terms by restructuring some of your balances on credit cards, car loans, etc.