My Korean-American Life

  Roth IRA, Backdoor Roth & Mega Backdoor Roth Recently, a friend of mine (let’s call him David, 57 years old) said at a dinner that he contributed $8000 to Roth IRA without realizing his income above the threshold and had to pay the penalty. And he asked me for advice. As Roth IRA offers major benefits, such as Tax-free growth on investments, No required minimum distributions (RMDs) during the owner's lifetime, it can become a powerful long-term tax hedge for investors expecting to remain in high tax brackets—or those concerned about future tax increases. However, The IRS restricts direct Roth contributions for higher earners.* In case if you contribute to Roth despite your income above the threshold, it triggers a 6% excise tax per year it sits in the account. Here's a breakdown of David’s situation: Assuming he doesn’t have any balance in traditional IRA There are two ways to fix this, and the right one depends on timing.--- The penalty: The IRS charges a 6% excise t...

Warren Buffett made headlines in early 2025 with a massive stock sell-off . Berkshire Hathaway, under Buffett's leadership, sold $133 billion in stocks while only purchasing $6 billion, resulting in a net sell-off of $127 billion. This aggressive selling spree is the most significant in the company's history . Buffett's decision to sell such a large amount of stock has raised concerns among investors and analysts. the stock market's current valuation is historically high, with the S&P 500's cyclically adjusted price-to-earnings (CAPE) ratio standing at 37.9, far above its 20-year average of 27. When the CAPE ratio has exceeded 35 in the past, the S&P 500 has posted negative average returns. In the fast-paced world of trading and investing, managing risk is paramount to long-term success. One effective tool that traders use to protect their profits and limit losses is the trailing stop. This dynamic order type adjusts itself based on the price movement of an...