American IRA Discusses the Differences Between a Self-Directed Roth IRA and a Roth 401(k)

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American IRA recently released a blog post explaining the key differences between a Self-Directed Roth IRA and a Roth 401(k).

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American IRA CEO, Jim Hitt

People understand that there are words like ‘Roth’ out there, but they do not always know what they mean

What are the key differences between a Self-Directed Roth IRA and a Roth 401(k)? According to a recent post by American IRA, the two retirement accounts might sound similar—and even share some similarities in functions—but the key differences can help shape how retirement investors plan their overall strategy.

Pointing to what the article calls “significant differences between the two,” the post reveals that while a Self-Directed Roth IRA and a Roth 401(k) can be held at the same time by a retirement investor, it takes an employer to offer a Roth 401(k) for an individual investor to participate. The post further highlighted key differences, such as contribution and income limits. For example, there are no income limits for the 401(k). The post also noted that Roth and Traditional IRA contributions are limited to $6,000 or the amount of earned income, whichever may be less. Those over the age of $7,000 may use catch-up payments and set aside up to $7,000.

“People understand that there are words like ‘Roth’ out there, but they do not always know what they mean,” said Jim Hitt, CEO of American IRA. “This post had the goal of clearing the air about two very intriguing types of accounts: a Self-Directed Roth IRA and a Roth 401(k). And we dove into the specifics that really highlight why you might consider these two accounts to be wholly separate from each other, even if you can technically have both in your portfolio.”

The article also dove into how distributions are handled differently between a Self-Directed Roth IRA and a Roth 401(k) account. According to Jim Hitt, however, the ability to self-direct a Roth IRA is a powerful way to build wealth for the long term, including the ability to invest in real estate, private company equity, and even precious metals.

“It may seem like getting into the weeds to answer these questions, but people who want to maximize their chances of retiring with financial peace need to ask these questions when they establish their own accounts,” said Jim Hitt. “The details matter.”

For more information about the Self-Directed Roth IRA and how it relates (or does not relate) to the Roth 401(k), visit the blog post at http://www.AmericanIRA.com or call 866-7500-IRA.

About:
American IRA, LLC was established in 2004 by Jim Hitt, CEO in Asheville, NC.
The mission of American IRA is to provide the highest level of customer service in the self-directed retirement industry. Jim Hitt and his team have grown the company to over $400 million in assets under administration by educating the public that their Self-Directed IRA account can invest in a variety of assets such as real estate, private lending, limited liability companies, precious metals and much more.

As a Self-Directed IRA administrator, they are a neutral third party. They do not make any recommendations to any person or entity associated with investments of any type (including financial representatives, investment promoters or companies, or employees, agents or representatives associated with these firms). They are not responsible for and are not bound by any statements, representations, warranties or agreements made by any such person or entity and do not provide any recommendation on the quality profitability or reputability of any investment, individual or company. The term "they" refers to American IRA, located in Asheville and Charlotte, NC.

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