So how can we, everyday people, do something similar even if we're not the founder of the next billion-dollar company?Read and get educated for once.Apparently not. He invested $2k and made $5 billion. All tax free. Yippee!!!I do. However our stupid incompetent government shouldn’t allow this.
Why not? There are contribution and income limits.
Apparently not.
There are, really.
He invested $2k
Like I said, contribution limits.
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The late Sen. William Roth Jr., a Delaware Republican, pushed through a law establishing the Roth IRA in 1997 to allow “hard-working, middle-class Americans” to stow money away, tax-free, for retirement. The Clinton administration didn’t want to give a fat tax break to wealthy people who were likely to save anyway, so it blocked Americans making more than $110,000 ($160,000 for a couple) per year from using them and capped annual contributions back then at $2,000.
Yet, from the start, a small number of entrepreneurs, like Thiel, made an end run around the rules: Open a Roth with $2,000 or less. Get a sweetheart deal to buy a stake in a startup that has a good chance of one day exploding in value. Pay just fractions of a penny per share, a price low enough to buy huge numbers of shares. Watch as all the gains on that stock — no matter how giant — are shielded from taxes forever, as long as the IRA remains untouched until age 59 and a half. Then use the proceeds, still inside the Roth, to make other investments.
Lord of the Roths: How Tech Mogul Peter Thiel Turned a Retirement Account for the Middle Class Into a $5 Billion Tax-Free Piggy Bank
Open a Roth with $2,000 or less.
Bastard!
Then use the proceeds, still inside the Roth, to make other investments.
I know, he was the first outside investor in Facebook.
How the average investor can apply Thiel's strategy
The short answer is, we can't. Not exactly, anyway. Most Americans who invest in Roth IRAs will never be able to buy shares in tiny, privately held startup companies for fractions of a penny, like Thiel did. The vast majority of us are shopping the open market and investing in ETFs, index funds, mutual funds, and individual, publicly traded companies.
I asked financial advisors how everyday people can build wealth in a Roth IRA, the account PayPal founder Peter Thiel used to turn $2,000 into $5 billion
So what if he got a sweetheart deal and avoided taxes on a massive profit, that 99.9% of Americans could never attain.
So thinks the dumb con.
Is that why you're so miserable?
Because Thiel has so much money in his Roth?