WHAT IS A TRADITIONAL IRA VS ROTH IRA?

Confused about what is a traditional IRA vs ROTH IRA ? Asking yourself which type of IRA is best for me? Which one should I go for?

Have all your questions about ROTH vs traditional IRA (Individual Retirement Account) answered here.

Everyone is anxious to retire! Let’s see if we can accelerate that for you.  The challenge is how much money will you need to live the lifestyle you have become accustomed to living.

I’m Ted Thomas, and I have a few explanations that you’ll find profitable and informative. 

In this lesson, I’m answering your question, “What is a traditional IRA vs ROTH IRA?”

Today I’ll share with you a few money mistakes that you’ll want to avoid.  Many investors don’t pay attention to these mistakes, and they lose their assets, sometimes more than $25,000 or $50,000. 

Do you want to learn more about a little-known, 200-year-old way to create wealth investing in real estate? Then you don’t want to miss this FREE class that reveals the secrets that had formerly only been known by the elite. Isn’t it time you secured your financial future?

WHAT IS A TRADITIONAL IRA VS ROTH IRA? – A SOLID INVESTMENT

What is a traditional IRA vs ROTH IRA?  To start with, I’m going to tell you about 2 government-controlled and managed investments which provide investors guaranteed rates of return.    

This is a solid investment that was created and is administered by the state legislature and local counties.  Anyone may get in on this investment starting with less than $100.  

This investment is perfect for your IRA whether it’s a traditional or a ROTH IRA

Anyone who asks questions about IRA investments is approached by sales people, promoters, all trying to sell windmills, bulk gold, stocks and bonds, I could go on and on. 

There may be wild investments, and when you have an IRA of any type, you’ll be exposed to everything.  

WHAT IS A TRADITIONAL IRA VS ROTH IRA? – A SAFE, SECURE INVESTMENT

Here’s the solution.  This whole process is unique.  It’s a government-controlled program. No broker, no banker, no attorney or sales person to pay, nor will that group tell you about this investment because it pays no commissions to anyone. You buy directly.

I’m not an attorney or a CPA or an investment advisor.  I’m an experienced entrepreneur in tax liens and tax deeds and also an author and a guide.

This little-known, but highly lucrative investment can have you making safe, secure returns with checks from the government in months.  

For example, these certificates pay interest rates from 16% in Arizona up to 36% in Illinois.  I’m not including all the states.  

WHAT IS A TRADITIONAL IRA VS ROTH IRA? – TAX LIENS AND TAX DEEDS

The United States has just over 3,000 counties. About 1,500 of those counties sell tax liens certificates, and the remaining counties sell tax defaulted properties.

You can purchase either tax lien certificates or tax deeds in your IRA. 

WHAT IS A TRADITIONAL IRA VS ROTH IRA? – TAX LIEN CERTIFICATES

When you purchase a tax lien certificate, you pay someone else’s taxes. 

This is a low-risk investment.  When you get paid, you’ll earn a high interest rate.  If you don’t get paid, you will be awarded the property with no mortgage

A common question is, “Ted, what if I don’t get paid?  Will I lose my money?”  The answer is, if you don’t get paid, the county will award you the property without a mortgage. 

How does this whole thing work?  The answer is the state government, basically the legislature and the county treasurer coordinated, they have rules, laws that require property owners to pay taxes. 

WHAT IS A TRADITIONAL IRA VS ROTH IRA? – TAX LIEN PROPERTY

The law is simple.  If you own property, you are required to pay your share of the taxes.  If the property owner fails to pay, the property owner forfeits the rights of ownership.  

Imagine a nice $300,000 home.  You paid the back taxes because you bought a tax lien certificate in your IRA, but you don’t get possession. You get the right to receive money at outrageously high interest rates. 

If the property owner refuses to pay, then you will own the property.  

Tax auctions wipe out, delete, extinguish any mortgage loans on the property.  When the property owner fails to pay and forfeits the property, the county wipes out the mortgage. 

Your traditional IRA or a ROTH IRA are perfect for these investments.  Your ROTH IRA or traditional IRA will be investing directly with the county.

The lifestyle you always wanted could be yours, so don’t miss out. Act now and take Ted’s FREE Tax Lien Investing Course to learn how to profit safely, securely, and predictably from tax liens and tax defaulted property.

WHAT IS A TRADITIONAL IRA VS ROTH IRA? – WHAT IS THE DIFFERENCE?

So what is a traditional IRA vs ROTH IRA?

The simple answer is a traditional IRA allows the individual to make tax deductions and then invest the money in the IRA. 

The traditional IRA will hold the money, and it will earn interest rates which are tax deferred.  This tax deferral will last until money is deducted or taken out as withdrawals. 

A ROTH IRA is usually money transferred in from a 401K or from a traditional IRA.  New investments within the ROTH IRA pay tax. When they are put into the IRA, there is no tax for life.

WHAT IS A TRADITIONAL IRA VS ROTH IRA? – WHY COUNTIES SELL LIENS AND DEEDS

What’s going on here?  Why do counties have tax liens and tax deeds?  The reason is local county governments have many bills to pay. The money to pay bills comes from property owners within the county.  Property owners are required to pay their share of the bills. 

The treasurer is authorized to levy taxes, collect taxes, and if the property owner fails to pay, the treasurer is authorized by the state legislature to confiscate, to seize the property, remove the owner, and sell the property at a public auction.  

WHAT IS A TRADITIONAL IRA VS ROTH IRA? – BUYING REAL ESTATE WITH A ROTH IRA

ROTH IRA entities are allowed to buy these properties which can be purchased for pennies on the dollar. The highest bidder at the auction wins. 

The ROTH IRA is then allowed to hold the property and allowed to rent the property. It’s basically allowed to do anything as long as the funds stay within the IRA. 

When the ROTH IRA sells the property, the money is returned to the IRA and no tax is assessed on the profit.  

WHAT IS A TRADITIONAL IRA VS ROTH IRA? – TRADITIONAL IRA

What is the point of a traditional IRA? A traditional IRA allows an individual to deduct money from their earnings, put the money into a traditional IRA and enjoy tax deductions. 

Money within a traditional IRA, assuming it’s drawing at 16%, 18%, or 20% with the tax credit is not taxable until money is withdrawn which is at 65 or 75 years old. 

The point is it’s a tax deduction going in, and you will pay taxes when you withdraw. Now let’s compare that to a ROTH IRA.

WHAT IS A TRADITIONAL IRA VS ROTH IRA? – ROTH IRA

A ROTH IRA makes investments, earns money, however it’s not taxable except when it’s put into the IRA. There’s no tax on profits.

Here is an example. I have many students who earn significant money within their IRA accounts.

One student purchased a single livable family home, 3 bed, 1 bath which had been abandoned.

The tax assessed value was only $55,000, which was far below market value.  No one bid at the auction for this property. 

WHAT IS A TRADITIONAL IRA VS ROTH IRA? – BUYING PROPERTY IN A ROTH IRA

The ROTH IRA purchased the property for less than $4,000.  No money out of the investor’s pocket, only IRA funds were used. 

This property was fully furnished.  There was one car in the garage, and on the other side was a boat with a motor.  The ROTH IRA funded the fix up, lawn maintenance, cutting of trees and general clean up. 

While all this was taking place, there was a buyer waiting to purchase the property, however the purchaser requested an installment sale. 

The ROTH IRA granted installments to the new purchaser of $1,000/month for 84 months. 

In summary, the selling price was $84,000.  The total investment was $11,000.  So the ROTH IRA gained $73,000 profit nontaxable.  This is perfectly legal, ethical, and it’s following the rules as congress intended.

TAKEAWAY

We hope you enjoyed Ted’s lesson, “What Is a Traditional Ira Vs Roth Ira?”

With a ROTH IRA, in a nutshell, you pay the taxes upfront, then the account grows tax-free, and the withdrawals are tax-free.

With a traditional IRA account, you contribute pre-tax dollars. The amount grows in your account tax deferred, and it’s not taxed until you withdraw the money when you retire.

Now imagine combining the tax benefits of an IRA with the incredible profits of tax lien and tax deed investing!

A tax lien certificate is a high yielding passive investment that’s secured by real estate. The interest rates can be as high as 36%, and if you don’t get paid, you get the property without a mortgage.

Tax deed properties can be purchased for 10, 20, or 30 cents on the dollar, and you get the property without a mortgage.

If you’d like to know more about tax delinquent property investing, you’ve come to the right place.

For over 25 years, Ted Thomas has been teaching students how to successfully invest in tax lien certificates and tax defaulted property, and many of Ted’s students have gone on to become financially independent.

Ted Thomas offers full support and a complete training with home study courses, Q&A sessions, live tutorials, workshops & web classes, and personal one-on-one coaching, everything you need at your fingertips.

If you want to learn more about how to make lucrative profits from tax lien and tax deed investing and secure your retirement, get started today with Ted’s FREE Master Class. It costs you nothing, so why wait?


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