I am quite new to investing (other than losing $90K in penny stocks back in 2004 and then staying away from market until about 2 months ago).
This information may seem very basic to most of you but I thought I would share since I really wish I knew this before. Due to my income level, I am not able to contribute to Roth IRA directly. However, there is a way around it:
- Open Traditional IRA account. I cannot take current year deduction for it because I max out my 401K.
- Contribute after-tax money to it. $5500 limit for 2017 and $5500 for 2018 ($6500 if you are over 50).
- Open Roth IRA account. Request your broker to convert Traditional IRA into Roth. Since your contribution to traditional was already after-tax, there is no additional tax implications and your gains grow tax free.
This was new and very helpful information for me.
Now, I need to figure out which stock or stocks will have highest growth. My highest conviction is ANET and SHOP.
Thank you to all the board members for providing so much valuable information here. I learn a lot and continue learning. DOING NOTHING seems to be the best way after your initial investment. I could share a few crazy things I’ve done when market went down in February (brought horror memories of me losing $90K in 2004 but I cared so much less back then as I was still in my 20’s and didn’t have kids) so I hit that sell button way fast and way pre-maturely losing quite a bit in a day and what’s worse, ALL of those stocks, ALL of them regained what they lost plus a lot more. Lesson learned.