I don't understand why a mega backdoor roth is superior to an index fund
Aug 23, 2021
19 Comments
I want to invest my bonus into an index fund with Vanguard as I already have a Roth/401k with Fidelity. I want to balance my investments between different companies in case any of them fail. Anyways, why is a megaback door superior to putting my money into a separate index fund. I've already maxxed Roth/401k/HSA for the year. I'm afraid of putting all my money with one company. #personalfinance #investments Please help thanks.
comments
The difference is you cannot withdraw the money until age 65 except in certain emergency situations.
edit: Apparently you can withdraw the principal with fewer restrictions. But then you can’t put the principal back in so this is not recommended.
Whoever named this technique i imagine is an elementary school math teacher.
You can buy and sell whatever investments you want in your IRA. What are you even talking about?
You expect to live to 59.5, right?
Also you can pull the principal at any time if u need it early.