Roth IRA with Fexingo: Tax-Free Retirement Accounts and Long-Term Investment Strategy

Lucas and Luna break down the IRS's ordering rules for Roth IRA withdrawals—why contributions come out first, how conversions are timed, and when earnings can finally escape tax-free. They walk through a concrete scenario of a 45-year-old who needs $30,000 for a medical emergency, showing exactly which dollars get penalized and which don't. Plus, they explain the five-year clock for conversions an...

Lucas and Luna break down the Roth IRA five-year clock, explaining how it applies to contributions, conversions, and earnings. They walk through a concrete example: a 45-year-old who converts a $100,000 traditional IRA in 2026 must wait until 2031 to withdraw those converted funds tax-free. They also clarify the separate clock for direct contributions and the tricky rule for inherited Roth IRAs. B...

Episode 52 of Roth IRA with Fexingo explores how self-directed Roth IRAs can invest directly in real estate, from rental properties to private lending. Lucas explains the prohibited transaction rules, the role of a qualified custodian, and a concrete case: using a self-directed Roth to buy a duplex in a 1031 exchange. Luna challenges the liquidity risks and asks about property management. Listener...

Episode 51 of Roth IRA with Fexingo tackles Roth IRA recharacterization — the underused IRS rule that lets you undo a Roth conversion after the fact. Lucas and Luna walk through a concrete case: a married couple in the 24% bracket who converted $50,000 in January, then saw their income spike from a surprise bonus and capital gains. With the 2026 tax brackets and the TCJA sunset, the conversion pus...

Episode 50 of Roth IRA with Fexingo: Lucas and Luna dive into the five exceptions to the 10% early withdrawal penalty on Roth IRA earnings. Using the example of a 40-year-old who needs $30,000 for a medical emergency, they walk through the rules for unreimbursed medical expenses, health insurance premiums while unemployed, disability, and substantially equal periodic payments. They explain how the...

Episode 49 of Roth IRA with Fexingo dives into a rarely discussed but critical rule: the ordering of withdrawals from your Roth IRA. Lucas explains the five-year aging requirement and the sequential layers—contributions, conversions, and earnings—that dictate tax-free access. Luna questions how this affects early retirees and those with multiple conversion buckets. They walk through a concrete exa...

In this episode of Roth IRA with Fexingo, Lucas and Luna explore the spousal Roth IRA contribution strategy—a powerful but often overlooked rule that allows a non-working or low-earning spouse to build tax-free retirement savings based on the working spouse's income. They break down the 2026 income limits ($240,000 modified AGI for full contributions, phasing out at $250,000), explain the contribu...

Episode 47 tackles the backdoor Roth IRA strategy in the wake of 2026 tax reform. Lucas and Luna explain how the new adjusted gross income thresholds affect high earners, walk through the mechanics of a non-deductible traditional IRA contribution followed by a conversion, and discuss the pro-rata rule that can trigger unexpected taxes. They also cover the new 2026 reporting requirements on Form 86...

Episode 46 of Roth IRA with Fexingo tackles a question most investors overlook: should you hold international equities inside your Roth IRA? Lucas and Luna break down the tax-efficiency case for foreign stocks in a tax-free account, focusing on the foreign tax credit trap. They walk through how U.S. dividend stocks held in a taxable account get a 15-20% rate, while international dividends can trig...

Episode 45 of Roth IRA with Fexingo examines the concept of tax diversification — why holding assets across Roth, traditional, and taxable accounts can reduce your lifetime tax burden. Lucas and Luna break down a concrete scenario: a married couple earning $150,000 per year who contribute to a Roth IRA for 25 years, then face RMDs from traditional accounts in retirement. They walk through how havi...

Episode 44 of Roth IRA with Fexingo breaks down the net unrealized appreciation (NUA) strategy — a powerful but underused tax move for company stock held inside a Roth IRA. Lucas and Luna walk through how NUA works with employer stock, the specific tax treatment that can convert capital gains into lower long-term rates, and why high-income earners with concentrated stock positions might benefit fr...

Episode 43 of Roth IRA with Fexingo explores self-directed Roth IRAs for real estate. Lucas and Luna break down the rules: you can own rental property inside a Roth IRA, but the tax traps are severe — no personal use, no self-dealing, and all expenses must flow through the IRA. They walk through a concrete example of buying a $200,000 rental via an LLC owned by a self-directed Roth IRA, calculatin...

Starting in 2024, families can roll unused 529 college savings plan funds into a Roth IRA without penalty—up to $35,000 over a lifetime. In this episode, Lucas and Luna walk through exactly how the rule works, the 15-year account age requirement, the annual contribution cap tied to the IRA limit, and a concrete example: a family with $20,000 left in a 529 after their child graduates. They compare...

Episode 41 of Roth IRA with Fexingo dives into the specific rules for handling excess contributions in a Roth IRA — a surprisingly common mistake. Lucas and Luna walk through a concrete scenario: a listener who accidentally contributed $1,500 over the limit in 2025, and the options available by the tax filing deadline and beyond. They explain the 6 percent annual penalty, the difference between re...

Episode 40 of Roth IRA with Fexingo dives into asset location — specifically why holding bonds in your Roth IRA can be a costly mistake. Lucas and Luna break down the math: a $10,000 bond allocation in a Roth vs. a taxable account over 20 years, showing how lost tax-free growth on equities outweighs the minimal tax benefit of bonds. They discuss when exceptions might apply, like for retirees using...

Episode 39 of Roth IRA with Fexingo dives into a costly mistake that catches many savers off guard: contributing more than the annual limit to a Roth IRA. Lucas and Luna walk through the IRS penalty structure—six percent per year until corrected—and the three fix methods: a return of excess, carry-forward to next year, or recharacterization to a traditional IRA. They use a concrete example of some...

Episode 38 of Roth IRA with Fexingo: Lucas and Luna explore a little-known strategy — using a Roth IRA as a college savings vehicle that can outperform a 529 plan for some families. They break down the mechanics: Roth IRA contributions (not earnings) can be withdrawn tax-free and penalty-free at any time, including for a child's education. Using a concrete example of a parent contributing $6,500 p...

Episode 37 of Roth IRA with Fexingo dives into a hidden cost of Roth conversions: the Income-Related Monthly Adjustment Amount, or IRMAA, which can spike your Medicare Part B and Part D premiums. Lucas and Luna walk through a concrete example: a 65-year-old couple converting $100,000 from a traditional IRA to a Roth in 2026, and how that extra adjusted gross income could add over $4,000 a year to...

Episode 36 of Roth IRA with Fexingo tackles a specific and powerful rule: using Roth IRA contributions and earnings penalty-free for a first home purchase. Lucas and Luna walk through the $10,000 lifetime limit, the five-year rule for earnings, and the crucial distinction between withdrawing contributions (always tax- and penalty-free) versus earnings (qualified only if the account is at least fiv...

In episode 35 of Roth IRA with Fexingo, Lucas and Luna explore a seldom-discussed advantage of Roth IRAs: tax-free rebalancing. Unlike taxable accounts where selling winners triggers capital gains taxes, a Roth IRA lets you rebalance without tax consequences. The hosts walk through a concrete example using a hypothetical $50,000 portfolio split between a total stock market ETF and a bond fund, sho...

Episode 34 of Roth IRA with Fexingo tackles the often-overlooked estate planning pitfalls that can derail your Roth IRA's tax-free legacy. Lucas and Luna walk through a real-world scenario: a California couple with $800,000 in Roth assets who named their adult child as sole beneficiary—but never updated the designation after a divorce and remarriage. The episode explains why beneficiary designatio...

Episode 33 of Roth IRA with Fexingo tackles a question most advice glosses over: once you're a high-net-worth investor with a sizable traditional IRA balance, does converting to Roth still make sense? Lucas and Luna walk through the math for a hypothetical couple with $2 million in a traditional IRA, a 37% marginal rate, and a 25-year retirement horizon. They compare the tax torpedo from Required...

Episode 32 of Roth IRA with Fexingo dives into an overlooked variable: which brokerage holds your Roth IRA. Lucas and Luna break down how custodian fees, investment options, withdrawal flexibility, and even customer service can quietly cost you thousands over decades. They compare Vanguard, Fidelity, Schwab, and a couple of robo-advisors, looking at expense ratios, account minimums, and the fine p...

Episode 31 of Roth IRA with Fexingo unpacks the little-known 'stretch IRA' strategy for Roth beneficiaries. Lucas and Luna walk through a real-world case: a 45-year-old inherits a $340,000 Roth IRA from a parent. They break down the ten-year rule for non-spouse beneficiaries, the perils of leaving the account in cash too long, and why converting inherited traditional IRAs to Roth can backfire. Spe...

Episode 30 of Roth IRA with Fexingo dives into a critical but often overlooked difference: how the IRS treats inherited Roth IRAs for spouses versus everyone else. Lucas and Luna break down the specific rules, including the surviving spouse's option to treat the IRA as their own versus the non-spouse's required 10-year distribution rule. They walk through real scenarios, explain why a non-spouse b...