How to Build a Roth IRA from $2k to $1 Million

Are you brand new to the idea of planning for retirement? Or perhaps you are looking boost your retirement plan? Either way, we all would like to successfully retire and get to a place of financial freedom.

Getting to that place of financial freedom can be tough. However, if you have the right knowledge and execute your plan, you can reach your goals.

In order to help you build your retirement plan, we’re going to be starting a new challenge this September 2024 and inviting you to join the journey. The challenge is simple: build the value of a Roth IRA account from $2k to $1 million.

We’re going to accomplish this by a combination of scalp trades, swing trades, and long term investments. Along this challenge we will be documenting the whole journey so that you can learn about different trading and investment strategies. Hopefully you can then apply what you’ve learned in your own retirement journey.

Why $2k as a starting point?

Technically the starting value of the account we will be using is $1663.65. We’ve chosen to start near $2k as that is a more attainable value for most people. Investing with $2k is way different from investing with $200k. We will be sure to tie it back to smaller amounts as the challenge account grows in value.

Why $1 million as an end goal?

Just as a raw value $1 million sounds good for a challenge goal. In a more practical sense, $1 million is a sound number for a lot of retirement plans. Every one’s retirement goal is different and is based on their personal retirement needs, but $1 million will give easy math for budgeting.

In case you missed it, what is retirement?

Retirement is the stage in life when a person stops working full-time, often due to reaching a certain age or financial condition that allows them to live without needing to earn a regular income. It’s a transition from the working phase of life to one where people have more time to pursue personal interests, hobbies, travel, spend time with family, or simply relax.

What is a Roth IRA?

A Roth IRA (Individual Retirement Account) is a type of retirement savings account in the United States that allows you to contribute after-tax income. Unlike traditional IRAs, where contributions may be tax-deductible and withdrawals are taxed, contributions to a Roth IRA are made with money that has already been taxed.

Strategies for building a Roth IRA

Scalp Trades

A scalp trade, or scalping, is a trading strategy used in financial markets where traders aim to profit from small price movements over very short periods of time. Scalpers make numerous trades throughout the day, often holding positions for just a few seconds to a few minutes. The goal is to “scalp” small profits repeatedly, which can add up to significant gains over time.

Swing Trades

A swing trade is a type of trading strategy where traders seek to capture gains from market swings, which are price movements that occur over a period of several days to a few weeks. Unlike day trading, where positions are closed within the same day, swing traders hold their positions longer to capitalize on medium-term trends.

Long Term Investing

Long-term investing is a strategy where individuals or institutions buy and hold investments for an extended period, typically several years to decades, with the goal of building wealth over time. Unlike short-term trading strategies that seek to capitalize on quick price movements, long-term investing focuses on the gradual appreciation of assets and the compounding of returns.