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Stocks and your 401(k) may surge now that Fed rate hikes seem to be over, history shows
(www.usatoday.com)
this post was submitted on 19 Nov 2023
133 points (94.6% liked)
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Keep in mind the following: source
Don’t forget that when someone is talking about the average American “owning stocks” what they really mean is “has a retirement account that works in a way they don’t fully understand, which includes securities such as stocks, that they are not legally allowed to touch until they are 60”.
Anyone who tries to insinuate that the way average Americans “own stocks” is in any manner comparable to the way the wealthiest do, should honestly literally be put in the stocks where commoners can hurl tomatoes at them.
You are not forced to buy stocks in a 401(k), but most people chose to as it has significant tax advantages over owning them outside of a retirement account. Rich people would LOVE to own more in the same way and pay less taxes.
https://www.nbcnews.com/tech/tech-news/billionaire-investor-peter-thiel-has-5b-his-tax-free-retirement-n1272317
There is an annual contribution limit of $6,500 into a Roth IRA. They are something many Americans have as they are a solid investment choice. Invest the money in a total stock market fund and it will help you greatly when you retire.
The reason he has so fucking much money in his is because he literally gambled the money in the account. Someone is always going to win the lottery.
Uh not really… he started PayPal and then sold himself like 1 million shares at $0.001 (a tenth of a penny!) a share. Did you even read the article? Literally anyone who starts a business has to inject capital. It’s not gambling any more than any other person simply starting a business.
Also if you do read the article. You will learn it is not just Peter thiel, but many many many wealthy individuals who have done similar things. You say “the ultra wealthy would love to have Roth IRAs!” Well guess what: they do and it’s often a substantial portion of their fortune.
So what is your point now?
He did that in 1999 when PayPal was still X.com, something almost nobody has heard of, and it was not clear if the company would make it. As I said, he gambled his money and he won the lottery. Someone is always going to win the lottery.
You say in your original comment to me “the ultra wealthy would love to benefit from Roth IRAs!” Well guess what: they do and it’s often a substantial portion of their fortune.
So what is your point now?
They can still only put in $6,500 per year into the account. As I said "Rich people would LOVE to own more in the same way and pay less taxes."
This guy won the lottery. Should we kill a program that you can only put $6,500 in per year that millions of Americans use just because someone wins the lottery? If that is the route you suggest, we will have to go and kill every program that people use to invest in their future.
So they’d love to do a thing that they have all demonstrated they are perfectly capable of doing? What is even the value of such a comment?
You can get around limits with strategies like backdoor Roth IRA, also in some cases if you are the owner of the company you can have the company make distributions / contributions for you that go beyond the normal limits as well.
Ultimately, it is very much geared to benefit those that already have.