Eve has been investing in her brokerage account and the tax liabilities are starting to add up. She wants to retire in 12 years and is wondering if she should invest in after-tax contributions and plan on a Roth conversion.
Anonymous has rental properties and wants to start building his kids credit histories. Is it a good idea to add them as co-borrowers on the mortgage?
Lily is really excited about investing in real estate, but househacking wasn’t the right fit. She’s looking for advice on investing in opportunity zones through crowdfunding platforms.
Eve asks (at 02:30 minutes):
My employer just started allowing after-tax contributions in our 401(k)’s with in-plan roth conversions. My plan is through Fidelity, it’s low cost and I have index funds available.
Currently I max out my 401(k), am planning for about $15,000 of traditional contributions, $4,500 of Roth contributions and I also max out my Roth IRA.
I make about $60,000, my expenses are approximately $20,000 and I invest the difference in my brokerage. I have a fully funded one-year emergency fund and my brokerage has about $170,000 right now.
I file jointly with my spouse who makes about $60,000 but doesn’t have access to retirement funds through work. He fully funds a Roth IRA and puts the rest into his brokerage.
Our total taxable income is now about $100,000 annually and we’ve been doing small capital harvesting transactions to help reduce the tax liability in our brokerage. Between our accounts, the dividends are starting to add up and the capital gains will too.
I struggle to pull the trigger with buying in my brokerage and automatic investments are painless to me…but I do like the ease of putting money into brokerage in our early retirement.
I’m 33 and hope to retire by the time I’m 45. Should I invest in after tax contributions and do an in-plan Roth conversion or stick with my brokerage.
Anonymous asks (at 10:40 minutes):
My wife and I are here on an H1B visa. We are planning on quitting our jobs and moving back to India.
Our original plan was to reach FI by May 2022, when I turn 40. We reached our FI numbers in 2020 but due to the pandemic and school closures, we delayed our plan for a couple of years. We are still on target to quit our jobs and move back to India.
We have at least five years of expenses saved in cash, in savings accounts and CD’s in India, and all of our other assets are in the US. We do not want to liquidate them and take them to India right away. We have rental properties, 401(k), Roth IRA, and taxable brokerage accounts. We own umbrella insurance for the rental properties and term life insurance.
We have two kids, a 4 year old and a 7 year old, both of whom are US citizens.
Do we need a will or a trust?
My kids might want to come back to the US later for either a college education or a job. Is there a way to give them a headstart on building their credit while we are still in India?
I understand the drawbacks of adding minor children to the deeds on the rental properties, but would it be OK to add them as co-borrowers in the mortgage, without adding them to the deed? At what age can children be added as co-borrowers? Can I do that while in the US or after going back to India?
Is there anything else that we need to take care of before leaving the country? There’s no guarantee that we can come back here to sign things.
Lily asks (at 29:53 minutes):
I took your rental property course and I really liked it! I’ve been house hacking a duplex for a couple of years now and I decided to let the duplex go, mostly for mental health and peace of mind.
Have you ever changed your investment strategy and how’d you work through that change? I feel like a little bit of a failure because I couldn’t make this work but I’m trying to see this as an opportunity to reset.
My second question: I’m still excited about investing in real estate and I’d like to defer the capital gains from the sale of the duplex into an opportunity zone, probably via crowdfunding.
I’m wondering what questions you would ask yourself before investing in an opportunity zone and what you’d consider before a crowdfunding investment.
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