ShmoopTube

00:00

Finance allah shmoop What is a keogh plan Well basically

00:07

it's an ira for self employed people and more or

00:10

less like have your own company your own llc Well

00:14

then you probably want to sock away some dough without

00:17

paying taxes today betting that you'll want to pay him

00:20

instead Tomorrow if ever knock on the door of keogh

00:24

plan central and you'll save your way to prosperity Sort

00:28

of lungs You invest the money well in the market

00:30

Well basically the keio works just like an ira If

00:33

you makes a hundred grand a year and you pay

00:35

thirty five percent tax on that last ten grand that

00:37

you make or thirty five hundred box well instead you

00:40

could put that ten grand into a keogh plan invested

00:44

for however many years until you're an old geezer Think

00:47

seventeen and a half plus And hopefully that ten grand

00:50

grows a whole lot in an index fund or something

00:52

like that Because the market doubles about every seven eight

00:55

nine ten years something like that And then when you're

00:58

not working i'ii earning ah whole lot less money Well

01:01

then you can start withdrawing that money from your keogh

01:05

Plan You pay something more like i don't know twenty

01:07

percent in taxes at that point because you're taking lesson

01:10

pay than you did when you were accumulating wealth like

01:13

that thirty five percent So while the fuss to save

01:16

just fifteen percent net difference in taxes at thirty five

01:20

minutes Twenty there Well it's not that much fuss A

01:23

few forms you fill out of filing here and there

01:25

and well that's kind of it You go buy an

01:27

index fund and sit but more to the point it's

01:30

a day discipline That is when you have this wonderful

01:33

allure of saving taxes well for most people it's enough

01:36

of an incentive to actually save money rather than spend

01:40

it and that's a good thing to dio So you

01:42

don't end up like this guy living in his suv 00:01:46.432 --> [endTime] you know down by the river

Full Transcript