Personal Finance

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Neech Yates
  • Investor
  • Louisville, KY
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Rolling 401k money to a back door Roth IRA. Is this a good idea

Neech Yates
  • Investor
  • Louisville, KY
Posted May 27 2022, 05:27

I'm thinking about rolling a 401k into a Roth IRA to invest in multi-family. Would this be a smart move? I do know that I will have to pay tax on the rollover. However I think that I could a higher return in real estate then the stock market. Looking for some good sound advice. Thanks!

Louisville, Kentucky

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Taylor L.
  • Multifamily and Self Storage Investor
  • Richmond, VA
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Taylor L.
  • Multifamily and Self Storage Investor
  • Richmond, VA
Replied May 27 2022, 05:39

Read up on UBIT. If you're investing in multifamily there's a good chance there will be debt involved and your IRA may have to pay UBIT. Impacts your return and adds complexity.

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Neech Yates
  • Investor
  • Louisville, KY
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Neech Yates
  • Investor
  • Louisville, KY
Replied May 28 2022, 05:47
Quote from @Taylor L.:

Read up on UBIT. If you're investing in multifamily there's a good chance there will be debt involved and your IRA may have to pay UBIT. Impacts your return and adds complexity.


 Thanks for the information. I will look that up!