Dollars & Sense: Three Advanced IRA Strategies Aren’t Used Enough

Dr. Harold Wong

There are three advanced IRA strategies that are rarely used. The Roth IRA allows tax-free income from your investments. The Multi-Generational IRA can double income for your heirs. The Self-Directed IRA allows you to invest in alternatives (such as direct real estate, equipment leasing, and private lending) to Wall Street investments.

Ticking Tax Time Bomb: For 30 years, you contribute $10,000 a year to an IRA or 401(k). You are lucky, and it grows to $1 million by age 63. You are in a 25% tax bracket, and the $300,000 total deduction saves you $75,000 in taxes.

You don’t need the money at age 63, and it doubles to $2 million at age 73. If you and your spouse both passed away that year, the $2 million would go to your kids and adds to their normal taxable income. At a 40% tax rate, that’s $800,000 of taxes vs. the $75,000 you saved. The government wins big-time!

The only solution is a Roth IRA Conversion! By converting the $1 million at age 63 to a Roth IRA, you get two major benefits. All future earnings are tax-free for your life, your spouse’s life, and the first 10 years your kids inherit the Roth IRA. There are NO Required Minimum Distributions (RMDs), which start at age 73 for folks who reach that age this year.

What if there was a strategy that allows you to do large Roth IRA Conversions without paying any federal income tax? Why stay in forever-taxed traditional IRAs and 401(k)s instead of never-taxed Roth IRAs?

The Multi-Generational IRA used to allow your IRA to grow for three generations! However, the SECURE Act took effect on Jan. 1, 2020, and limited delayed distributions of your IRA, after your death, to a maximum of 10 years to your heirs, such as kids. This 10-year delay option is enough to double the IRA, but most kids take the IRA money immediately after the parents die.

The Self-Directed IRA: allows access to alternative investments such as direct real estate instead of Wall Street stocks, bonds, and mutual funds. These alternatives can generate a 7-10% or more annual cash flow, which is at least three times what bank CDs, bonds, and stock dividends pay. Ask yourself: would life be better if I had $20,000 to $100,000+ more annual retirement income? This strategy is rarely utilized, because there are few trustees that allow a true self-directed IRA.

Attend my Free Live Seminar, “Secrets of Roth, Multi-Generational, and Self-Directed IRAs!” on Wednesday, March 22, at 6 p.m., followed by free dinner, OR Saturday, March 25, at 10 a.m., followed by free lunch, at Hyatt Place, 3535 W. Chandler Blvd. Chandler, AZ 85226.

To RSVP for the seminars or schedule a free consultation, please contact Dr. Harold Wong at 480-706-0177 or [email protected]. His website is

Dr. Wong earned his Ph.D. in Economics at University of California/Berkeley and has appeared on over 400 TV/radio programs.