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Roth IRA Withdrawals
TL;DR: How to withdraw your Roth IRA money tax and penalty-free. Let’s first review Roth IRA retirement accounts (I first introduced them here): You can contribute up to $6,000 a year (as of 2020), with an extra $1,000 of catch up contributions if you’re 50 or over. You are contributing after tax (hence, roth). You have complete freedom over how to invest that money, and that your earnings are tax-free. There is an income limit – in 2020, your income must be under $139,000 (if single, or $206,000 if married filing jointly) to contribute. (However, there are ways to do a backdoor contribution). There are no age limits (min or…
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The Mega-Backdoor: Insane 401k Contributions
TL;DR: You may be able to contribute more to your retirement accounts. This is just to bring this to your attention – make sure you do your own research. Your maximum contribution to 401k accounts is $19,500 this year right? WRONG And I’m not talking about the catchup contribution you can make if you’re over 50. The overall limit is actually $57,000. Depending on your employer (please check with them), you may be able to contribute more than the $19,500 to an after-tax 401k (not Roth) where taxes on gains are not skipped but just deferred until you have withdrawals. But here’s the twist – you may be able to…
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4% back (in cash!) on dining
TL;DR: Previously I’ve mentioned some alternatives to the Uber Card. US Bank recently came out with the Altitude Go card as a great alternative. In June of this year, US Bank came out with a much needed Altitude Go card to fill the void the Uber card left when it nerfed its perks. Details: 4x points on Restaurants (Dining, takeout, delivery) (i.e. 4% back) 20000 points ($200) bonus after spending $1000 in the first 90 days 2x on Grocery, Gas Stations, Streaming services, 1x on everything else $15 subscription credit annually (after you pay for 11 months for some subscription, you get $15 credit for the 12th month) No annual…
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Keep getting cash back on UberEats!
TL;DR: Ibotta has stopped giving 5% back on UberEats. But Drop continues to give 4% back. If you’re like me and you’ve been using UberEats to get by during this time, this is helpful! Happy Eats’ing, TheJKW
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Butter
TL;DR: Butter offers 1% back on subscriptions. It’s up to you if it’s worth it. How much do you spend on subscriptions? Butter has a service to aggregate all your subscriptions (which include things like Netflix and Amazon Prime) and if you link your credit card, they’ll offer you 1% back on top of your credit card rewards. This service was originally offered in Canada and has expanded to USA. They say they use this data to advertise other subscriptions to you that you may be interested in. I, for one, will say this is my threshold for how cheaply I’ll sell my data – all I have is Amazon…
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Huntington Voice Credit Card: 3% back in select categories
TL;DR: 3% back in a category of your choice. Huntington Voice is offering a credit card that offers 3% back (in the form of points) in a category of your choice. They offer 10 different categories you can choose from: Gas Stations Travel & Entertainment Restaurants Discount and warehouse stores Grocery Stores Utilities & Office Supply stores Electronics, Computer, and Camera Stores Department, Apparel & Sporting Goods Stores Auto Parts & Service Stores Home Improvement Stores Of course, there are only some categories here that are not covered by other (better) credit cards. These categories are: Discount and Warehouse Stores Office Supply Stores Auto parts & Service Stores Home Improvement…
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Thinking Fast and Slow
TL;DR: Learn about cognitive biases. About 6 years ago when I did my first internship in quantitative finance, one of the first books recommended to me was Thinking Fast and Slow by Kahneman. It introduces many cognitive biases in most people, put many times in the context of economics. For example, the concept of anchoring. This is the idea that hearing numbers before making an opinion can bias your perception of a “fair value”. The amazing thing is that the numbers you hear could be completely unrelated to the numbers you are estimating. There have been experiments where you can ask a room of people the last two digits of…
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Master Guide Step 3: Taxes
TL;DR: Contact a lawyer. Ok, I tried my best to give some general advice/direction on where to look when it comes to taxes. Check it out here 🙂 Happy(-ish) Tax’ing! TheJKW (Note that I am not a lawyer. Please contact a tax lawyer for definitive, up-to-date tax advice). P.S. New posts every Sunday at 5pm CST! P.P.S. Check out the TL;DR of TL;DRs here
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SIPC Insurance
TL;DR: Covers $500k (including up to $250k in cash) in the event your brokerage firm liquidates. Last week we looked into FDIC-insurance, and this week we’re going to explore something similar: SIPC insurance. This is to protect your assets/investments in brokerage firms. The key takeaway here is that it insures your investments in brokerage firms that FDIC did not. History: Established in 1970 after the congress passed SIPA, it’s meant to protect investors from failing brokerages. Although it was created under federal law, it’s not an agency or establishment of the United States Government. How does it work? First check that your brokerage is a member of SIPC. A quick…
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FDIC
TL;DR: FDIC covers 250k of cash at member banks. I hope you read more than the TLDR – I’ll try to keep it short but there are important details! I was recently asked by a friend to make a post going more in-depth on FDIC-insurance. It’s definitely not something everybody knows or is thinking about everyday. But it’s important! In the unlikely event of your bank failing, this is how you protect your assets! I recently was looking at this graph, I was surprised at how often smaller banks failed and FDIC was needed. Yikes at the peak around 2008 – we can hope it never happens again but be…