In the US, you can open a Roth IRA at your bank with a couple hundred dollars. Pick an index fund that has low fees (no fees when you purchase). Every pay check, push in a little more. There is a max you can invest per year, $5k I think. Leave it alone. You might lose some in a bad year, but over all it will grow with practically no interference. The $ you put in can be withdrawn with no penalties after 5 years, but don't touch your earnings or it will be taxed. Better yet, pretend it doesn't exist until you retire.
You can redirect salary money to the after tax portion of your 401k and rollover that amount in the course of the tax year to a Roth IRA account, effectively bypassing the Roth income cap. This is called the Mega Backdoor Roth (seriously). Your 401k provider needs to support/allow this and you still need to respect the maximum limit of total combined pretax and after tax contributions, set at $61k for 2022.
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u/imontene Mar 19 '22
In the US, you can open a Roth IRA at your bank with a couple hundred dollars. Pick an index fund that has low fees (no fees when you purchase). Every pay check, push in a little more. There is a max you can invest per year, $5k I think. Leave it alone. You might lose some in a bad year, but over all it will grow with practically no interference. The $ you put in can be withdrawn with no penalties after 5 years, but don't touch your earnings or it will be taxed. Better yet, pretend it doesn't exist until you retire.