BUILDING FINANCIAL FREEDOM/LEGACY TEN DOLLARS AT A TIME!
BUILDING FINANCIAL FREEDOM/LEGACY $10.00 AT A TIME!
Disclaimer: Good Day, Readers. WealthBuildingPowers blog is a financial literacy/competency blog and does not provide specific financial advice.
INVESTING TEN DOLLARS PER MONTH
POP QUIZ #1:
I give Amanda {daughter} $10.00 per month starting at 21, and I am fortunate enough to continue this for 40 years! {DANG- I’m freaking OLD!} If Amanda deposits that money in a ROTH IRA and invests in the S&P 500 ETF -VOO, assuming 10% annual returns, how much would she have at the age of 61?
{Note: Only earned income can be contributed to a Roth IRA}
- $4,800.00
- $25,768.00
- $63,768.00
- $650,768.00
ANSWER POP QUIZ #1:
At the end of 40 years, I deposited $4,800.00. Due to the wonders of compounding, Amanda will have: Answer C: ~ $63,768.00 – TAX-FREE
However, if I started Amanda’s ROTH at the age of ten, at the end of 51 years of contributions, Amanda would have ~$193,106.00 – TAX-FREE. CAN I GET AN AMEN!
POP QUIZ #2:
What if Amanda matches my $10.00 contribution each month? If we contribute $20.00 per month in a ROTH IRA, investing in the S&P 500 ETF -VOO, assuming 10% annual returns, how much would she have at 61?
- $127,536.00
- $141,536.00
- $152,536.00
- $160.536.00
ANSWER POP QUIZ #2:
Simply double the amount from Pop Quiz #1: {2 X $63,768.00} Answer A: $127,536.00 – TAX FREE
However, if we started investing in a ROTH when Amanda was ten, at the end of 51 years of contributions, Amanda would have ~$386,213.00 – TAX-FREE. CAN I GET A HALLELUJAH!
FINAL POP QUIZ QUESTION:
What if Amanda and I team up to invest the maximum of $6,000.00 in a ROTH IRA for 40 years, and she starts taking more responsibility for contributions as her income increases. If she deposits that money in a ROTH IRA investing in the S&P 500 ETF -VOO and assuming ~ten percent annual return, how much would she have at the age of 61?
FINAL ANSWER:
- $1, 127,536.00
- $2,141,536.00
- $3, 188,390.00
- $4, 160.536.00
The answer is C. The two of us deposit $240,000.00 total in the account, and at age 61, Amanda has: Answer C: ~$3,188,390.00 – TAX-FREE
Can I get a BOOM CHICKA POP A, BOOM CHICKA POP A BOOM!
I LOVE THE ROTH IRA
The ROTH IRA grows your HARD-EARNED MONEY, TAX-FREE! That’s worth repeating – ZERO – TAXES! It sounds un-American since our government taxes us after we die! Take advantage of a great deal. {I wonder if Congress Members even read the ROTH IRA bill before voting to pass it! – NAH!}
Roth IRAs allow for tax-free growth and tax-free withdrawals of the money deposited in the account and ALL funds earned. While the ROTH IRA is designed for retirement savings, tax-free withdrawals of deposited funds can be used for education, home down payments, etc.
KEEPING IT SIMPLE STYRON {KISS} – INVESTING IN THE S&P 500 ETF
The first stock I ever purchased was a penny stock called OSPBI (ONLY STUPID PEOPLE {NAMED STYRON} BUY IT!). You guessed it; I lost over half my money! That was the last penny stock I ever purchased. A stock is selling for pennies for good reasons! Penny stock companies usually have more holes than the Titanic!
Who should buy individual stocks? Those with the TIME, KNOWLEDGE, AND COMPETENCYto analyze companies’ stocks, read the stock charts, select the resistance, and support prices, interpret STOCK indicators, and a lot more. Suppose you work full-time or multiple jobs and have ten kids (enough for full-court basketball); consider a lower risk investment – Standard & Poor’s 500 Index (S&P 500), such as the Vanguard, VOO ETF index. This index invests in 500 MAJOR U.S. companies. Some go up, some down, and some are stuck like glue at the same price. But on average, you see positive gains over the LONG TERM -YEARS.
Top S&P 500 Stocks by Index Weight
- Apple Inc. (AAPL) Index Weighting: 6.2% …
- Microsoft Corp. (MSFT) Index Weighting: 5.9% …
- Amazon.com, Inc. ( AMZN) Index Weighting: 3.9% …
- Facebook, Inc. (FB) Index Weighting: 2.4% …
- Alphabet Inc. Class A (GOOGL) …
- Alphabet Inc. Class C (GOOG) …
- Tesla, Inc. (TSLA) …
- Nvidia Corp. (NVDA)
With a net worth of ~$118.00 BILLION, Warren Buffett is considered the world’s best stock investor. Mr. Buffett stated, “the S&P 500 ETF index fund is the best investment MOST Americans can make.” He puts his money where his mouth is and when he dies, he directs his wife’s money to be invested in an S&P 500 Index fund. Mr. Buffett believes an S&P 500 index fund investment is a bet on American business, an excellent long-term strategy. Over the long run, the S&P 500 has generated total returns of about 10% annualized.
CONCLUSION – WHAT TEN DOLLARS OR MORE PER MONTH CAN DO FOR YOUR KIDS!
Many of today’s retired Americans receive monthly company pension checks. Hundreds of large companies that offered pensions, such as General Electric, General Motors, Boeing, and more, no longer offer pensions. Our kids NEED their OWN retirement dollars! The ROTH IRA is a terrific retirement vehicle coupled with other retirement accounts {401K, IRA, SEP, etc.}
Parents are under zero obligations to leave their kids one dime. My daughter just stopped breathing! Relax Amanda!
I am not helping Amanda with her ROTH IRA because I NEED to, but because I WANT and can afford to do so. I contribute to Amanda’s ROTH IRA to assist her in achieving financial freedom as soon as possible. Helping her do what my parents did for me – build a foundation for a great life.
The ROTH IRA is an excellent tool for those of you who WANT and can afford to contribute.
If I had one piece of advice for anyone who hasn’t started investing yet for self or your kids, it would be: Please, just start. If that feels hard, ask for help. Money and investing are an emotional business. Seek advisors to help wade through your valid concerns and questions!
LET’S MAKE SOME MONEY – CRYPTOCURRENCY IS ACCEPTED!
YOUR GREATNESS IS NOT WHAT YOU HAVE; IT’S WHAT YOU GIVE! – SOME CHARITIES I SUPPORT
St Jude Hospital: https://www.stjude.org/
Wounded Warrior Project: https://www.woundedwarriorproject.org
Folds of Honor: https://foldsofhonor.org
Wilson’s No-Kill Animal Shelter: https://wcnkas.org
TRUST ME – YOU WILL LIKE THE BELOW BLOGS!
ROTH IRA
THE ROTH IRA IS SO GOOD. THE FEDS MADE A MISTAKE!
https://wealthbuildingpowers.com/2020/01/13/the-roth-ira-is-so-good-the-feds-made-a-mistake/
A ROTH IRA WILL IGNITE THE ENGINE FOR YOUR KID’S FINANCIAL FREEDOM
S&P 500 ETF
KEEP IT SIMPLE STUPID {KISS} – THE S&P 500 ETF INDEX
KEEP IT SIMPLE STUPID {KISS} – THE S&P 500 ETF INDEX
MAGIC OF COMPOUNDING
COMPOUND INTEREST IS THE EASIEST WAY TO DOUBLE OR TRIPLE YOUR MONEY
COMPOUND INTEREST IS THE EASIEST WAY TO DOUBLE OR TRIPLE YOUR MONEY
WARREN BUFFETT UTILIZED COMPOUND INTEREST TO BECOME THE 3RD RICHEST MAN ON THE PLANET!
WARREN BUFFETT UTILIZED COMPOUND INTEREST TO BECOME THE 3RD RICHEST MAN ON THE PLANET!
401-K AND OTHER RETIREMENT PLANS
RETIREMENT PLANS OTHER THAN THE 401-K TO GENERATE > $1 MILLION PORTFOLIO!
DO YOU WANT TO JOIN THE 401K PLAN MILLIONAIRE CLUB? {KINDA OF LIKE THE MILE HIGH CLUB – BUT A LOT LONGER LASTING!}
401-K YEAR-END SALE!
OTHER TOPICS
TURNING YOUR STIMULUS CHECK INTO MILLIONS $$$$!
https://wealthbuildingpowers.com/2021/03/22/turning-your-stimulus-check-into-financial-freedom/
SO YOU GOT A HUGE TAX REFUND – NOW WHAT?
SO YOU GOT A HUGE TAX REFUND – NOW WHAT?
YOUR BIGGEST RISK TODAY – A LONG LIFE!
INVESTING IN STOCKS IS COLOR BLIND – WHAT IS STOPPING YOU?
FINANCIAL LITERACY IS JUST NOT THAT COMPLICATED – TRUST ME!
https://wealthbuildingpowers.com/2019/04/01/financial-literacy-is-just-not-that-complicated-trust-me/
THE NEED FOR EMERGENCY SAVINGS – MORE IMPORTANT TODAY THAN EVER!
THE NEED FOR EMERGENCY SAVINGS – MORE IMPORTANT TODAY THAN EVER!
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ABOUT ME
I am a proud nerd (as my beautiful wife and daughter have told me) investment and finance blogger with an NC. State, Chemical Engineering, University Rutgers, MBA and Harvard University, Advanced Management education.
I left a corporate career because I desired to make a difference as a speaker and writer. I was blessed to be coached and mentored by strong women and men in my family and professional life. It is my time to serve and give back.
DISCLAIMER
I started my first business at ~13 years of age (a small but brilliantly created plant nursery). I am a successful investor in stocks, options, real estate and am happy to share my finance and investment lessons. I am NOT a licensed financial advisor. Please do not construe my suggestions on this blog as recommendations for your situation. As an investor, you must establish your risk/loss tolerance. Investment in any asset involves risk, including complete loss.
Please seek your licensed CPA or fiduciary financial advisors for individual financial advice.
I write this weekly blog to make an impact by reaching an audience and demonstrating the need for financial literacy. I will help you get there.
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