Intro

Business owners face a ticking deadline that could cost them $500 per day—yet many have never heard of it. The Beneficial Ownership Information form, due December 31st, is just one of the under-the-radar compliance issues that can derail even the most careful financial plans. In this mailbag episode, Brad Barrett and certified financial planner Rachael Camp tackle this and a stack of listener questions on retirement accounts, asset allocation, backdoor Roth IRAs, and real estate investing—covering what to do when your employer doesn't offer a 401k and how to protect yourself from sequence of returns risk in early retirement.

Chapters

• Introduction [00:00:00]
• Public Service Announcement [00:01:21]
• Mailbag Questions [00:03:43]
• Asset Allocation Discussion [00:24:07]
• Real Estate Investing [00:56:01]
• Conclusion [01:07:10]

Key Topics

How to Invest Without a 401k: Options include traditional IRAs and Health Savings Accounts (HSAs), while noting contribution limits. [00:03:43], [00:04:12]

Company Matches in Retirement Accounts: Highlighted as a crucial opportunity to maximize savings [00:09:12]

Backdoor Roth IRA: A legal way for high earners to sidestep income limits for Roth IRA contributions [00:15:09]

Asset Allocation: Discussion on the complexities of asset allocation, particularly as one approaches retirement, and the impact of sequence of returns risk [00:24:07]

Real Estate Investing: Key considerations and the risks associated with real estate investments [00:56:01]

Key Quotes

"Avoid reverse dollar cost averaging by holding onto equities during market downturns." [00:39:28]

"Company matches in retirement accounts offer unmatched returns—don't miss out!" [00:09:12]

"Explore diverse account types for effective financial management." [00:10:00]

Action Items

• Look up the beneficial ownership information form if you own a legal entity [00:02:04]
• Review and potentially set up a traditional IRA if your employer doesn't offer a 401k [00:04:12]
• Maximize your retirement account contributions to include any employer matches [00:09:12]
• Consider maintaining a cash buffer for the first few years of retirement to mitigate risks [00:26:36]
• Consider your asset allocation strategy as you approach retirement [00:27:30]

Resources

• IRS Publication 590-A [00:12:12]
• BiggerPockets [00:01:55]
• Risk Parity Radio Podcast [00:28:10]

Related Episodes

• Episode 513: Make Your Own Dividend [00:57:00]
• Episode 176: The 3.5% or 4% Rule [00:22:27]
• Episode 475: Accessing Retirement Accounts Early [00:51:17]

Terminology

Backdoor Roth IRA: A method for high-income earners to fund a Roth IRA by first contributing to a traditional IRA and then converting it. [00:15:09]

Sequence of Returns Risk: The risk of receiving lower or negative investment returns early in retirement, which can adversely affect the portfolio's longevity. [00:26:36]

401k: A tax-advantaged retirement savings plan sponsored by an employer that allows employees to save and invest for retirement. [00:04:12]

▶ Listen Next: Ep. 522 — Back to Basics: Finding Balance in Financial Independence | Essential Listening

Join the Community
Connect with thousands on the path to financial independence. Share wins, ask questions, and stay accountable. Join ChooseFI.

New to ChooseFI?
Start with our most popular episodes, hand-picked to give you the foundation of financial independence. Listen to the essentials.

Run Your Numbers
Find out when you could reach financial independence with our free calculators and planning tools. Try the FI Calculator.

Support the Show
We work hard to keep ChooseFI ad-free for a clean listening experience. The easiest way to support us is to use our Top Recommended Cards page when signing up for your next travel rewards credit card.

Get the Weekly Roundup
The best FI content, deals, and community highlights delivered to your inbox every week. Subscribe free.