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Updated about 10 years ago,
Investing with pre-tax dollars?
Hi everyone, I've been devouring some recommended books over vacation and one book made a point that actually blew my mind. It stated if you buy a $50,000 home with traditional W-2 income, I truly"paid" $75,000 pre-tax dollars for the property. In other words, I had to earn $75,000 to buy a $50,000 item. This fact finally made me realize the benefit of "pre-tax" saving/allocating and the power of passive income to use for future purchases.
Now, I've listened to around 70 podcasts, read quite a few books and in my recollection the only way to use pre-tax dollars for real estate is through a self directed IRA which is more appropriately used for notes than a rental property.
Is there any other way to allocate W-2 income pre-tax to use for investment property purchases?
Thanks!