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I'm trying to figure out what is the best path for my situation.
I expect to be able to contribute the 5k cap toward an IRA for 2 more years and thereafter I will exceed the income limit to max out this IRA. Currently own a rental property with + cash flow and I'm considering buying another rental property in either 5k, 30k,240k target price. I currently have one already. No retirement accounts. Currently have <50k tied up in stocks/cash.
With this limited information, what is the favored retirement account strategy? Roth IRA, traditional IRA,
Strategy? Should I pay off 150k left on house in next few years? Rate is 3.85% 1100 mo
If you have a rental property + a primary mortgage I think you need much more cash on had. I'm assuming you live in a very low cost of living area, but I would not feel comfortable with only 50k in cash/stocks with two mortgages. I'm also assuming you dont have a 401k plan at your disposal?
I would of course max out the IRA then bump up the liquid savings before I look for more real estate. The 3.85% loan would probably be the last thing I would touch.
Say you have at least 50 years of life left. Think back 50 years, how much has the government changed things? Some on the far left have already talked about confiscating IRA and 401(k) accounts. At the very least, expect Roth IRAs to be taxed more than they are today. It will be something small, like a "withdrawal fee" of 1% or 2%.
Personally in these uncertain times, I think liquid is the best. Not only that, paying off your shelter is definitely the way to go. If your locals decide that those with no mortgages should pay more in property taxes, sit down and do the math and either take out a mortgage and park the cash. Paying off your properties makes it that much easier to deal with moving if you just have to move.
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