*Investors Blog*

Owen Lucas said:
If that's the case I'm probably sitting on $10k in coins as I used to buy the standing liberties dollars as a kid...for $5 each.
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If you bought those silver dollars new from the US mint and are pristine they are worth way more to coin collectors than their silver value.
 
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ZeeOSix said:
If you bought those silver dollars new from the US mint and are pristine they are worth way more to coin collectors than their silver value.
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Each one is in a stiff plastic bag, not a case unfortunately and they are not graded. Some have a natural patina but have always been picked up by the edges, if removed, which is almost never for some. Good to know!

Coin collecting is a fun hobby when you are a kid, hunting for the coins, buying 3 cent pieces and odd pennies, somehow when I had no money I was pretty interested in the hobby. Now that I have some disposable income, it's not worth collecting since I'd never be able to complete a set with all of the outliers.
 
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^^^ Yeah, coin collecting is a huge world in itself. I've bought some pretty nice old coins on eBay over the last year or so. I bought certain years that had significance to me. Some were silver, and worth way more now in melt value alone since silver price at least doubled since then.
 
And let’s not forget taxation on growth.

"If i were to invest 100k and it grows to 1 million"

Thought this was a good reminder for some, including me.

Short answer:
  • In a Roth IRA / Roth 401(k): you’re generally not taxed on the $1,000,000 if the withdrawal is qualified.
  • In a traditional 401(k): the entire amount you withdraw (including growth) is taxed as ordinary income when you take it out.




Here’s how it works in your example:

Roth account (Roth IRA or Roth 401(k))
You invest $100,000 → it grows to $1,000,000.

If the withdrawal is qualified (usually age 59½+ and the account is at least 5 years old):
  • Tax on the original $100k: $0
  • Tax on the $900k gain: $0
So you could withdraw the full $1,000,000 tax-free.

Why: Roth accounts are funded with after-tax money, so the IRS lets the growth come out tax-free if rules are met.

Traditional 401(k)

If the same thing happens in a traditional 401(k):

You invest $100,000 pre-tax → grows to $1,000,000.

When you withdraw:
  • The entire $1,000,000 is taxed as ordinary income in the year you take it out.
Example (very simplified):
  • Withdraw $100,000 in a year → taxed like income that year.
  • Withdraw the full $1,000,000 in one year → could push you into a very high tax bracket.

Key difference (simple way to remember)
  • Roth: Pay taxes before investing, then growth is tax-free.
  • Traditional 401(k): Skip taxes now, pay taxes on everything later.
One important exception
If you withdraw early from a Roth (before 59½ or before the 5-year rule):
  • Contributions usually come out tax-free first.
  • Earnings could be taxed and penalized.
 
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Doc8404 said:
And let’s not forget taxation on growth.

"If i were to invest 100k and it grows to 1 million"

Thought this was a good reminder for some, including me.

Short answer:
  • In a Roth IRA / Roth 401(k): you’re generally not taxed on the $1,000,000 if the withdrawal is qualified.
  • In a traditional 401(k): the entire amount you withdraw (including growth) is taxed as ordinary income when you take it out.




Here’s how it works in your example:

Roth account (Roth IRA or Roth 401(k))
You invest $100,000 → it grows to $1,000,000.

If the withdrawal is qualified (usually age 59½+ and the account is at least 5 years old):
  • Tax on the original $100k: $0
  • Tax on the $900k gain: $0
So you could withdraw the full $1,000,000 tax-free.

Why: Roth accounts are funded with after-tax money, so the IRS lets the growth come out tax-free if rules are met.

Traditional 401(k)

If the same thing happens in a traditional 401(k):

You invest $100,000 pre-tax → grows to $1,000,000.

When you withdraw:
  • The entire $1,000,000 is taxed as ordinary income in the year you take it out.
Example (very simplified):
  • Withdraw $100,000 in a year → taxed like income that year.
  • Withdraw the full $1,000,000 in one year → could push you into a very high tax bracket.

Key difference (simple way to remember)
  • Roth: Pay taxes before investing, then growth is tax-free.
  • Traditional 401(k): Skip taxes now, pay taxes on everything later.
One important exception
If you withdraw early from a Roth (before 59½ or before the 5-year rule):
  • Contributions usually come out tax-free first.
  • Earnings could be taxed and penalized.
Click to expand...
Yes but this is a bit misleading.

If your tax rate is the same during the period your putting it in, then when you take it out the net taxation is the same.

Example. Lets say tax rate is 40%.

If I put 10,000 in a tax sheltered account, and it compounds at 10% a year for 10 years, I get $25,937.42. If I take away 40% of that for taxes I get 15,562.45

If I pay the 40% tax rate and instead put $6000 in a roth and it compounds for 10 years, I also get $15,562.45. So same net affect.

As others have mentioned above there are other benefits, but the pure tax savings doesn't exist. What you need to determine is whether you will be in a higher tax bracket now or later.

You can do your own math: https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator


​

 
SC Maintenance said:
Yes but this is a bit misleading.

If your tax rate is the same during the period your putting it in, then when you take it out the net taxation is the same.

Example. Lets say tax rate is 40%.

If I put 10,000 in a tax sheltered account, and it compounds at 10% a year for 10 years, I get $25,937.42. If I take away 40% of that for taxes I get 15,562.45

If I pay the 40% tax rate and instead put $6000 in a roth and it compounds for 10 years, I also get $15,562.45. So same net affect.

As others have mentioned above there are other benefits, but the pure tax savings doesn't exist. What you need to determine is whether you will be in a higher tax bracket now or later.

You can do your own math: https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator


​

Click to expand...
very true, hard to believe my current calculations say I will make more when i retire....

I Best go ask how that changes if I retire 3/2/2026 :)
 
Doc8404 said:
very true, hard to believe my current calculations say I will make more when i retire....

I Best go ask how that changes if I retire 3/2/2026 :)
Click to expand...
Many people here are saying that. Sounds like a OK problem to have.

If I am anywhere close I will at minimum take residence in a state with no state income tax.

My real concern is once the trust funds run out they will likely start means testing or changing the rules.
 
I bought some DELTA AIR LINES this morning at 63. Their routes are barely affected by the Iran situation, except for flights to Israel. Oil prices are going to go up, but so will oil prices for competing air lines. People are not going to stop traveling, and I think the impact on oil prices will be temporary.
 
Zee09 said:
He is the crying bozo that has been attacking PLTR and is living off of his 2008 market crash nonsense...
And other AI stocks

He's all in at $46 and I hope he sinks... Currently He's down a $100 a share.... time for a bath Mikey 🛁
Click to expand...
SC Maintenance said:
Famous from the big short - bet against the mortgage CDO's and got rich.

Has had multiple short positions since - all losers.
Click to expand...
THAT guy. Ok yeah. Thanks

I sold OKE just now
 
Doc8404 said:
And let’s not forget taxation on growth.

"If i were to invest 100k and it grows to 1 million"

Thought this was a good reminder for some, including me.

Short answer:
  • In a Roth IRA / Roth 401(k): you’re generally not taxed on the $1,000,000 if the withdrawal is qualified.
  • In a traditional 401(k): the entire amount you withdraw (including growth) is taxed as ordinary income when you take it out.




Here’s how it works in your example:

Roth account (Roth IRA or Roth 401(k))
You invest $100,000 → it grows to $1,000,000.

If the withdrawal is qualified (usually age 59½+ and the account is at least 5 years old):
  • Tax on the original $100k: $0
  • Tax on the $900k gain: $0
So you could withdraw the full $1,000,000 tax-free.

Why: Roth accounts are funded with after-tax money, so the IRS lets the growth come out tax-free if rules are met.

Traditional 401(k)

If the same thing happens in a traditional 401(k):

You invest $100,000 pre-tax → grows to $1,000,000.

When you withdraw:
  • The entire $1,000,000 is taxed as ordinary income in the year you take it out.
Example (very simplified):
  • Withdraw $100,000 in a year → taxed like income that year.
  • Withdraw the full $1,000,000 in one year → could push you into a very high tax bracket.

Key difference (simple way to remember)
  • Roth: Pay taxes before investing, then growth is tax-free.
  • Traditional 401(k): Skip taxes now, pay taxes on everything later.
One important exception
If you withdraw early from a Roth (before 59½ or before the 5-year rule):
  • Contributions usually come out tax-free first.
  • Earnings could be taxed and penalized.
Click to expand...
You are neglecting the compounding effect you lost on the tax you paid on the initial Roth investment.
Generally speaking, a Roth IRA makes more sense if you are a lower income earner, or expect to be in a high income bracket in retirement.
 
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