Virtus Wealth Management Highlights Roth IRA Advantages for Long-Term Tax Efficiency
Virtus Wealth Management has launched an educational effort to increase Texas investors' awareness of the potential long-term tax benefits of a Roth IRA. Through this initiative, the firm aims to help individuals better understand how Roth IRAs may fit into a broader retirement strategy. As part of the outreach, Virtus Wealth Management Roth IRA resources are available to address frequently asked questions and misconceptions about this type of retirement account.
Unlike traditional retirement savings vehicles, Roth IRAs offer the potential for tax-free qualified withdrawals in retirement and do not impose required minimum distributions (RMDs) during the account holder's lifetime. According to Virtus Wealth Management, these features can make Roth IRAs a powerful tool for those seeking long-term tax efficiency and flexibility. The firm notes that tax diversification in retirement planning continues to grow in importance as legislative and tax policy changes remain a consideration for many high-income earners and business owners.
Roth IRAs are funded with after-tax dollars, meaning that contributions do not provide an immediate tax deduction. However, under current tax law, qualified withdrawals—which include earnings—are not subject to federal income tax. This may present advantages for those who anticipate being in a higher tax bracket during retirement or who want to preserve more control over taxable income later in life. Additionally, because RMDs are not required, Roth IRAs may give investors greater control over their withdrawal strategies, including legacy and estate planning considerations.
A spokesperson for the firm, Brian Tillotson, explained the rationale behind this educational initiative. 'There's a lot of confusion about when a Roth IRA makes sense and who benefits most,' said Brian Tillotson. 'This initiative is meant to clarify the potential tax advantages and help people understand that suitability depends heavily on personal goals, income level, and retirement horizon.'
Virtus Wealth Management emphasizes that Roth IRAs may not be ideal for every investor. Eligibility for direct contributions is subject to income limits, and specific criteria must be met for withdrawals to be considered qualified and tax-free. For those who exceed the income thresholds, strategies such as Roth conversions may be considered, although these come with their own set of implications that must be carefully evaluated. The firm encourages individuals to seek guidance from licensed professionals to explore what role, if any, a Roth IRA should play in their overall retirement strategy.
The firm's educational approach is grounded in the principle that informed decision-making leads to better outcomes. Roth IRAs may serve as an essential complement to traditional retirement accounts by offering flexibility in managing future tax liabilities. For families focused on intergenerational wealth transfer, the absence of RMDs can allow Roth IRAs to remain untouched, potentially growing for longer and being passed to heirs under favourable tax conditions.
Tillotson says, 'The long-term tax efficiency of a Roth IRA is not just about avoiding taxes—it's about having more options. Whether someone is concerned about future tax hikes, seeking to lower taxable income in retirement, or trying to leave more for heirs, a Roth IRA may provide flexibility that other accounts do not.'
Virtus Wealth Management's focus on Roth IRA education comes when many Texans are reassessing their retirement preparedness and exploring how to mitigate potential future tax burdens. With growing concerns about inflation, longevity, and changes to Social Security, the ability to create a tax-diversified retirement income strategy is becoming more valuable. The firm maintains that informed planning should involve looking beyond pre-tax contributions and considering how different account types will be taxed once distributions begin.
This educational push is aligned with Virtus Wealth Management's broader commitment to financial literacy, risk awareness, and customized planning for its clients. While the firm does not prescribe a one-size-fits-all approach, it seeks to arm investors with the tools and knowledge to ask the right questions and consider the whole picture when making retirement planning decisions.
Additional resources and guidance can be found on the Virtus Wealth Management website at https://www.virtuswealth.com/resources/roth-iras/ for individuals and families seeking to understand whether a Roth IRA is appropriate for their retirement goals. Investors are encouraged to consult a licensed advisor to assess their unique financial situation and determine how a Roth IRA may fit into a comprehensive retirement strategy.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
an hour ago
- Yahoo
Her Husband Signed The Contract—Then Panicked. A $1,880 Mortgage Left Them With No Room To Breathe, And Now He Wants Out
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. A stay-at-home mom thought she and her husband had found the perfect home. They agreed to a $430,000 price, put together a $165,000 down payment from savings and a gift, and signed the contract. Then her husband changed his mind. 'It met all our needs, in one of the best school districts in the state, and needed nothing done to it,' the original poster wrote on Reddit's r/RealEstate. But after crunching numbers, her husband had a meltdown. Don't Miss: Invest Where It Hurts — And Help Millions Heal: Maximize saving for your retirement and cut down on taxes: . The couple planned to put down $85,000 of their own money plus an $80,000 gift from his parents. Their monthly mortgage payment was estimated at $1,880. With a take-home income of $5,500 and no major debt, the numbers seemed manageable. Still, the husband panicked, saying there wouldn't be enough 'free cash' left every month. In a follow-up, the husband explained, 'My $5,500 take-home is net after maxing out the 401(k)... we want to allocate $30K of the sale price [of our current home] to an emergency fund.' He added that they were also contributing $1,200 a month to Roth IRAs and $400 to a college fund, leaving them with only a few hundred dollars in wiggle room. Even though the home was a rare find that ticked every box, the husband now wants to consult a lawyer to get out of the contract. Their realtor advised waiting until inspection to potentially withdraw—a common tactic even if the inspection is 'informational only.' Trending: With Point, you can But that wasn't enough reassurance. The husband admitted, 'The largest reason I am experiencing anxiety is that we are coming from a $1,100 a month mortgage payment, which leads to a lot more free cash. I just want to make sure my family is financially sound.' Commenters weighed in fast and hard. 'I would kill for a $1,900 a month mortgage,' one wrote. Others were more sympathetic. 'Financial stress is hard on marriages, and your husband is prone to it. He probably isn't suited to homeownership because of ongoing repair costs. He will fret about it,' one person said. Another reassured OP saying, 'You plan to go back to work and it will add to your budget. It's scary to make a big purchase, but I would regret walking from my perfect home. It may not come back around.'Many questioned whether the fear was justified. '$1,880 a month is less than what most rents are for a decent place,' a commenter said. 'You're in far better shape than most. This seems like panic, rather than an actual financial issue.' Some pointed to the family's unique situation. 'They have an autistic child. Adds a ton of insecurity,' one user noted. Still, others slammed the decision-making process. 'You should have been looking at $300K and lower houses,' one wrote. 'How did a mortgage company approve that?' One agent weighed in honestly: 'Signing a contract that does not give you any sort of due diligence or inspection contingency, and is only for informational purposes, is a really bad idea. No house is worth that.' If the couple backs out, they'll likely lose the $3,000 earnest money deposit. Most commenters agreed it's a small price to pay compared to long-term regret or marital tension. But others warned that dragging it out might damage their standing in future offers. . With over $1 million in dividends paid out last quarter and a growing selection of properties across various markets, Arrived offers an attractive alternative for investors seeking to build a diversified real estate portfolio. In October 2024, Arrived sold The Centennial, achieving a total return of 34.7% (11.2% average annual returns) for investors. Arrived aims to continue delivering similar value across our portfolio through careful market selection, attentive property management, and thoughtful timing in sales. Looking for fractional real estate investment opportunities? The features the latest article Her Husband Signed The Contract—Then Panicked. A $1,880 Mortgage Left Them With No Room To Breathe, And Now He Wants Out originally appeared on
Yahoo
an hour ago
- Yahoo
Ramit Sethi Reveals How To Have Better Finances Than 95% Of People In Three Months: 'You Don't Need A 6-Figure Salary'
"I Will Teach You To Be Rich" author Ramit Sethi recently shared how you can get ahead of 95% of people in three months. He claims that you don't have to haggle over small expenses or cancel everything fun in your life. He even throws in another caveat that makes it feel more accessible. "You don't need a six-figure salary," he declared in a recent video. Sethi proceeded to lay out a blueprint that anyone can use to get more control over their finances and build toward long-term goals. These are the steps you can take. Don't Miss: Maximize saving for your retirement and cut down on taxes: . Invest where it hurts — and help millions heal:. Most people claim to know their finances, but Sethi says you can unravel this myth by asking someone how much they spend every month. Knowing the exact number can help you feel better about your finances and know how you can improve. Sethi suggests reviewing the past three months of your bank account statements and credit card activity and dividing the total expenses by three. That's a good way to gauge how much you spend each month. You can then use that number as a benchmark and see if you can reduce your expenses. While you can skip coffee, Sethi points at housing as the biggest expense. Downsizing, having a roommate, or moving to a more affordable location are some of the ways to trim this expense. Trending: Then, commit to investing at least 10% of your paycheck every month. It's okay to start a little lower in the beginning, but you should build up to this number. Finally, setting automatic transfers to your 401(k), Roth IRA, brokerage account, bills, and credit card ensures that you pay yourself first instead of investing what's left after expenses. Your crossover point refers to the moment when your assets generate enough income to cover your expenses. Once you reach your crossover point, you can retire, but it's not about retirement. Reaching your crossover point gives you more options. You can travel more often, work fewer hours, or take a sabbatical. Sethi recommends using a retirement calculator to determine how many years it will take to reach your crossover point. A good retirement calculator will let you see how your crossover point will change based on adjustments you make to your monthly portfolio contribution and your expenses. This metric will give you a long-term financial goal that can solidify good financial explains that you will have a better grip on your finances than 95% of people if you follow these steps. However, you also have to enjoy the journey, and part of that involves asking questions about your new rich life. You should consider how you want to use your money and what expenses align with your values. For instance, some parents spend extra money to ensure that their children can attend private schools. Knowing what your future life can look like will help you earn more and spend less. The path to wealth is filled with many benchmarks, but Sethi suggests starting with the goal of reaching your first $100,000. He mentioned that once your net worth reaches that figure, your wealth grows much faster. Read Next:Can you guess how many retire with a $5,000,000 nest egg? . Image: Shutterstock Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? APPLE (AAPL): Free Stock Analysis Report TESLA (TSLA): Free Stock Analysis Report This article Ramit Sethi Reveals How To Have Better Finances Than 95% Of People In Three Months: 'You Don't Need A 6-Figure Salary' originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Insider
9 hours ago
- Business Insider
A 4-step guide to investing success for recent college grads
So you've just graduated from college. Congratulations! It's an exciting time in your life as you get ready to enter the workforce. One of the great things about being at the start of your career journey is that you have ample time to figure out the path you want to take in life and where your passions lie. Time is also your greatest asset when it comes to setting yourself up for a life of investing success. Thanks to the power of compounding, which Albert Einstein famously called the eighth wonder of the world, the earlier you start investing, the better. According to insurance firm Mass Mutual, a 22-year-old who invests $500 a month will have $2,255,844 by age 65, assuming the stock market delivers an average annual return of 8%. That number falls to $972,542 if one starts investing at 32. But investing isn't always easy, especially early on in your career when your earnings are lower. The process may also feel daunting and complicated if you haven't done it before. To put those fears to rest, we've come up with a step-by-step guide on how to best get your financial house in order so you'll thank yourself down the road. Come up with a budget There's no one-size-fits-all approach for budgeting, so it's important to come up with a plan that works for you, said Melissa Cox, the Dallas-based owner of Future-Focused Wealth. Trying to keep up with someone who may have a different budget than you do is one of the most common mistakes she sees young people make. "So many people come out of school and they just go crazy spending money," Cox said. "Social media and everyone sees what everyone else is doing — don't fall into that." A good rule of thumb is to set aside 20% of your pre-tax income, according to Bryan Kuderna, the founder of New Jersey-based Kuderna Financial Team. So, if your salary is $100,000, you should be trying to save $20,000 a year. But again, the practical savings rate will vary from person to person. Many recent grads have student loans to tackle, so it's good to understand what your repayment options are, Cox said. Maybe forgiveness is possible, or lower monthly payments based on your income. Perhaps refinancing your loans will allow for more manageable payments. Finally, it's important to keep yourself a priority, Cox said. For example, perhaps you really value traveling or shopping — it's good to set some money aside for those things as well. Build a buffer When you start working, it's smart to set up a retirement account like a 401(k) or Roth IRA and start contributing right away. But we'll get to that in the next section. When it comes to your money outside those accounts, the first thing you want to do — assuming you don't have credit-card debt — is build up a buffer of six months of living expenses, Kuderna said. This is because people in their 20s often have big life events that they need the money for, he said. Having it in risky assets like stocks makes it vulnerable to downside in the near term. "I always say liquidity is huge for a young professional," Kuderna said. "I might move out, I might have to get a new car, I might be getting engaged, married, a kid — all these things that can happen in your 20s." While you might not want your money invested in stocks right away, you also don't want to have it just sitting in a checking account. Instead, plug it into a high-yield savings account or a money market fund to collect a better yield while short-term interest rates are still high. Open multiple investment accounts OK, now for the investment accounts. First, make sure you have a Roth IRA or 401(k) set up with your employer and are collecting their monthly minimum match. As of 2025, you can contribute up to $23,500 to a 401(k) and $7,000 to a Roth IRA. 401(k) contributions are made with pre-tax money; the money is then taxed upon withdrawal. Roth IRA contributions are made with post-tax income, and eventual withdrawals are not taxed. Setting these accounts up is important because the money comes straight out of your paychecks — it's like it never existed, and there's less of a temptation to spend it since withdrawals before you're 59-and-a-half years old are penalized at 10%. Plus, you can take advantage of the tax benefits. "I'm huge on Roth options, especially for young people," Kuderna said. "If we can get tax-free growth for another four or five decades, that's worth its weight in gold." Once those are set up, open up a brokerage account to invest your excess savings. Considering your cash savings, Kuderna said this is taking a three-pronged approach: having cash for the short-term, a brokerage account with stock investments for the medium-term (maybe a down payment for a house in five, 10, or 20 years), and retirement accounts for the long-term. Having a brokerage account for medium-term investments will allow you to capture potential market upside while not being subject to the 10% penalty of withdrawing money from a 401(k) or Roth IRA early. "You don't want to neglect the mid-term," he said. "When you're 40 or you're 50 and you need money, you don't want to hit your retirement accounts, and you don't want to have it all just sitting in cash." Decide where to invest Now that you have your accounts set up, it's time to decide where to invest. The classic portfolio structure is 60% stocks and 40% bonds. Stocks, while riskier, offer greater upside potential. Meanwhile, bonds are supposed to act as a buffer to stock market volatility by protecting your capital, producing a steady yield, and appreciating during times of economic distress. But since you're in your 20s, you might consider allocating even more of your money to stocks since you can likely withstand more volatility, according to Chris Chen, the founder of Insight Financial Strategists. He said an 80/20 portfolio may be more appropriate. How you allocate money in your medium-term and long-term investment accounts may look different, however. For your 401(k) or Roth IRA, one simple way to invest for the long term is by buying a target-date fund. For example, you might choose the Vanguard Target Retirement 2065 Fund (VLXVX) or the State Street Target Retirement 2070 Fund (SSGQX). These funds automatically adjust your allocations to stocks and bonds as you age. As you start to approach retirement, the percentage of your money in bonds starts to increase to preserve your capital. Right now, the Vanguard 2065 fund has 53.1% of its assets in the Vanguard Total Stock Market Index Fund, which is made up of US stocks; 37.5% of the fund is in the Vanguard Total International Stock Index Fund; 6.5% is in US bonds; and 2.9% is in international bonds. Expense ratios, or the fees that certain funds charge, are also something to keep in mind. The Vanguard Target Retirement funds, for example, have a fairly cheap expense ratio of 0.08% a year. The cheapest S&P 500 index fund is the Fidelity 500 Index Fund (FXAIX) at 0.015%. For your medium-term investments, you should assess your risk-tolerance and timeline. Stock valuations are high at the moment, which suggests average 10-year returns may not be great. So if you need the money in five-to-10 years, being fully in stocks might be the wrong approach. But if you feel you can have a longer timeline than that, Kuderna said investing in bluechip stock indexes like the S&P 500 is a good approach. If you want to be especially aggressive, you might consider investing heavily in tech stocks, he said. The sector is often riskier than other areas of the market, but has seen explosive growth over the last 15 years. Some funds that offer exposure to tech stocks include the Technology Select Sector SPDR Fund (XLK), the iShares US Technology ETF (IYW), and the Invesco NASDAQ 100 ETF (QQQM). "If you look at the greatest returns over a long period of time, it's in equities, it's people who have a higher risk appetite," Kuderna said. "If you've done those beginning steps of building a rainy day fund, setting money aside, not carrying any bad debt — if you're good there and we can afford ourselves a long-term time horizon, then we should try to almost encourage ourselves to be a little more aggressive."
