It is temping to think you know more than you do when your stash grows. Success gives the illusion of intelligence. When the crisis arrives the illusion evaporates.
Please, kind readers, use common sense. If you don’t fully understand the concept and the financials then take a pass. Better to miss a deal than to go all-in on a scam.
What is the largest expense you’ll have in your life?
Some will say it’s the purchase of their home or their college education. Others, thinking about it a while, feel transportation expenses lead the list of lifetime expenses. You would be justified in thinking medical costs, including medical insurance, are the biggest expense you will face in life.
Yet none of these expenses are close to what you will pay in taxes over a lifetime.
Taxes will consume over half of what the average American earns over a lifetime. This means no other expense can possibly be larger.
The list of taxes in nearly inexhaustible: federal income taxes, state income taxes, sales taxes, excise taxes, payroll taxes, property taxes and now tariffs are being added to the costs of many goods you buy.
On a recent ChooseFI podcast where I was the guest speaker I mentioned the possibility the backdoor Roth and her sister tax strategy, the laddered Roth, could be going away. Many people heard me say it WAS going away. That is false. It is only a proposal at this time.
Because so many potential tax law changes now whispered in the halls of Congress have the potential to cause great damage to those in retirement or working an accelerated program toward financial independence (FI), now is the perfect time to review those with the highest possibility of happening. A word of caution before we begin. These are only ideas floating around Congress. They are NOT current tax law! Not all ideas whispered in the halls of Congress become law, but all laws start as a whisper in the halls of Congress. There is a difference.