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Many people ask my opinion about the Roth IRA. My short answer is that they’re the second best deal out there – so I’m a pretty big fan.

But the Roth has its limitations. Many people don’t qualify because of income and other limitations. My experience (and probably yours too) is that when the government limits our access to something – it’s probably very good for us – and not so good for them.

So the fact that they make access to Roth IRAs difficult for the wealthy, is probably something we should pay attention to. That’s why I was struck by a recent article revealing that the wealthy have found a way around the Roth limitations, and are leveraging Roth IRAs like Jed Clampett leveraged ‘black gold.’

An obscure IRS rule allows owners of traditional IRAs to convert them into Roth’s by paying the tax bill at today’s rates. So the wealthy are loading up their traditional IRAs (which are less restrictive), then converting them into Roth IRAs.

You see – the wealthy never want their money taxed – ever again. That’s the beauty of a Roth: after-tax contributions go in – but tax-free withdrawals come out – the exact opposite of a traditional IRA.

What’s more, funds in a Roth are not subject to Required Minimum Distributions (RMD’s) – which often force taxes out of people who don’t need the money for lifestyle purposes.

So if the wealthy are doing the opposite of what most of us are doing – how can we piggy-back their strategy and capture it’s benefits for ourselves?

Remember when I said I believed the Roth IRA was just the second best way to build tax-free wealth? The best way is a properly structured cash-value life insurance policy – something even the most modest saver has access to.

Life insurance is like a ‘Super-Roth’ – without the restrictions, and it offers a whole slew of other features the Roth can’t touch.

So if you haven’t looked at cash value life insurance as a wealth-building vehicle, you may want to seek out a really good advisor and see for yourself.

When the wealthy are doing something well, it usually pays for us to figure out how to flatter them with our imitation.  In this case – we can – and should.