Whether you make huge amounts of revenue with your movie website or a small trickle, you need somewhere to house your earnings. Most would think just to bank them in their ordinary saving or checking account. This is an error on their part, one losing them profits for both the short and the long term. There are two options available to the savvy movie website owner wishing to benefit from where they store their hard earned cash.
1. ) Charles Schwab Bank’s High-Yield Investor Checking Account
First off, the account is free to open and maintain. Second, you earn interest on the money stored in that checking account (0.50% variable Annual Percentage Yield [APY] on every dollar in the account—regardless of your balance). Third, when using the check card they issue you, you are reimbursed for all charges when used at a non-Charles Schwab ATM. I was on the phone talking over the specifics with a representatives about the ins and outs of the checking account recently. Your High Yield Checking is also linked to a free Charles Schwab brokerage account. That brings us to the second place to store your movie website bucks while earning a profit.
2.) Roth IRA
It’s not free, the average cost to start one is a thousand dollars. The minimum contribution is usually a hundred dollars. A Roth IRA is an
individual retirement plan that bears many similarities to the traditional IRA, but contributions are not tax deductible and qualified distributions are tax free. Similar to other retirement plan accounts, non-qualified distributions from a Roth IRA may be subject to a penalty upon withdrawl. A qualified distribution is one that is taken at least five years after the taxpayer establishes his or her first Roth IRA and when he or she is age 59.5, disabled, using the withdrawal to purchase a first home (limit $10,000), or deceased (in which case the beneficiary collects).
With your brokerage account you can start and manage a Roth IRA. The sooner you start, the more you will have accumulated at the age of 59.5 when you can draw from the account without penalty. Your earnings accrue tax free. You can setup a Roth IRA so that is runs in the background of your finances. You will need to print out, fax or mail into the bank a Mutual Fund Automatic Investment Plan (AIP) Request or some analogous form. This form allows you set up annually monthly contributions to the Roth, deducted from your checking or savings account automatically.
I know what your thinking: “I don’t have the scratch or know-how to do this.” Like I said, Charles Schwab Bank’s High Yield Investor Checking Account is free. You can transfer you existing account over to it at no cost. The brokerage account is free. You do not have to start a Roth IRA or any IRA if you do not want to though it would be prudent move on your part, the sooner the better. You can also transfer over your existing IRAs and mutual funds to your Charles Schwab brokerage account to keep everything simple with your finances.
Other bank accounts that offer earning interest on the funds in your checking or savings account require that you have a certain amount in the account before you can qualify to have a high-yield account and they also require that you keep a certain amount in there or they will charge you an account service charge. Some charge you an account service charge regardless. Charles Schwab Bank’s High Yield Investor Checking Account does not.
As this post illustrates, it is very advantageous to read periodicals like Entrepreneur Magazine and Kiplinger’s Personal Finance Magazine. They are filled with useful information like this for a movie website owner. Where do you think most of the information in this post originated from?
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