Skip to main content

How to Pay Less in Taxes


3 Tools To Help You Pay Less Taxes


We all have a love-hate relationship with taxes. While taxes go towards paying for public services everyone take for granted. We all wish we could pay a little less. Fortunately for us. There are a few things we can do to give less of our hard earned money to the government in taxes, and keep a little more for ourselves.

The 401K Plan


401K plans are a great way to pay less in taxes and keep a little bit more for yourself, and many employers match your contributions, allowing you to essentially automatically double your tax-deferred contributions. With a 401K plan, you can allot a certain amount of money to be put towards your retirement before you pay your taxes, and you’d then be taxed when you start withdrawing your money later in life.

The Roth IRA Account 


Roth IRA’s are by far my favorite investment accounts. With a Roth IRA, you can make contributions after you’ve paid your taxes, and the great thing is that your money wil grow tax-free. Meaning, once you retire and start withdrawing money from your retirement account, everything you’ve accumulated will not be taxed. I find that the Roth IRA is a great counter balance to the 401K.

Taxes requirements are always changing. If taxes are raised in the future, you’ll be paying more when you finally withdraw from your 401K, but you can withdraw from your Roth IRA tax-free. If taxes are lowered in the future, you would have paid more in taxes when you initially contributed to your Roth IRA, but you’ll be paying less in taxes withdrawing from your 401K.

Capital Gains


There are different types of many different types of income. Earned income is what you make when you go to work and trade your time for money. Capital Gains is income you make on your investments. If you buy $100 worth of stock $XYZ at $10 per share, and the price of the stock rises to $20 per share. You now have $200 and sell all your shares. The $100 you made would be considered your Capital Gains, and as of right now, if you held that stock for 2 years, you would have to pay 0% in taxes for that $100. These laws are subject to change, but take advantage of this while you can.

Those are just a few things you can do to give less of your money away in the form of taxes. Do some research, find out how much your employer matches on their 401K plan. Look into opening a Roth IRA, and start earning some Capital Gains. 

As always, this is not financial advice as I am not a financial advisor. These are just a few tools I personally use to keep more of my hard earned money.

The brokerage, Webull, is a commission-free brokerage that will give you some free stocks to start on your investing journey when you sign up and fund your account using this link: https://act.webull.com/ne/4wM7AjZ5YfWE/trh/inviteUs/
Webull also allows you to open a Roth IRA on their platform to start working on those tax-free gains.

Go to FreeStock.Club to claim some free stocks.

Labels

Labels:

Comments

Post a Comment

Popular posts from this blog

Schizophrenia: A Comprehensive Exploration of Genetics Mutation and Psychiatry

* Source: aWanderingMind.Life . Schizophrenia, a multifaceted mental disorder, affects millions of individuals globally. It manifests through a spectrum of symptoms, including hallucinations, delusions, and disorganized thinking. Typically, the onset of schizophrenia occurs between late adolescence and early adulthood, with males often experiencing an earlier onset than females. The etiology of schizophrenia is complex, involving a combination of genetic and environmental factors. The Intricate Genetic Landscape of Schizophrenia Research has consistently highlighted the significant role of genetics in the development of schizophrenia. It is estimated that genetic factors account for approximately 70% to 80% of the risk associated with schizophrenia. However, it's crucial to understand that a genetic predisposition does not guarantee the development of the disorder. Instead, it indicates that these individuals may be more susceptible to environmental factors that contribute to ...
Post a Comment
Read more

The Intersection of Technology and Mental Health: A New Frontier in Healthcare

* Source: aWanderingMind.Life . In the digital age, technology has become an integral part of our daily lives. It has transformed the way we communicate, work, learn, and even how we manage our health. One area where technology's impact is increasingly being felt is mental health. This intersection of technology and mental health is creating new possibilities for diagnosis, treatment, and ongoing management of mental health conditions. The Emergence of Mental Health Apps One of the most visible ways technology is impacting mental health is through the proliferation of mental health apps. These apps, available on smartphones and tablets, offer a range of services, from providing information and self-help tools to offering therapy sessions with licensed professionals. Apps like Headspace and Calm have gained popularity for their mindfulness and meditation exercises. These apps are designed to help users manage stress and anxiety, promoting mental wellness through daily practi...
Post a Comment
Read more

The Profound Impact of Post Traumatic Stress Disorder (PTSD)

* Source: aWanderingMind.Life . Post-Traumatic Stress Disorder (PTSD) is a complex and multifaceted disorder that can have significant effects on an individual's brain and body. It involves alterations in various brain regions and neural networks responsible for memory, emotion regulation, and stress response. This article delves into the profound impact of PTSD on its victims, shedding light on the neurological and physical changes that occur as a result of this disorder. The Neurological Impact of PTSD PTSD can lead to significant alterations in the brain. These changes occur in key areas responsible for emotional processing, memory formation, and stress response. Amygdala: In individuals with PTSD, the amygdala, a key brain structure involved in emotional processing and fear response formation, tends to be hyperactive. This heightened activation leads to an exaggerated fear response, hypervigilance, and the formation of traumatic memories. Hippocampus: The hippocamp...
Post a Comment
Read more