Roth IRA Explained For Beginners (is it tax free?)

Welcome back everyone! Are Roth IRA's truly tax free? Well yes. But no. A Roth IRA can only be funded if you are earning income and paying taxes on that income. Because of that, the "taxes" are paid on the income you have already earned.

Now that aside - if you follow the rules of a Roth IRA, when you are ready to withdraw (at age 59 1/2), you will be able to withdraw from the account 100% tax free! No federal tax. No state tax. Just straight cashflow!

Investing in a Roth IRA is something everyone should consider (I am not a financial advisor, make your own decisions, do your own research, this is not investment advice, etc). The implications of having a completely tax free income stream are really hard to ignore.

As Dumpster Diving (future) Millionaires, we are planning on maxing out our Roth IRAs every single year.

Peace, love, and cashflow - trashflow is cashflow!