How Investors Are Using Roth IRAs to Make Tax-Free Gains in Startups

As YC Demo Day approaches and startups prepare to raise rounds, forward-thinking investors are taking a strategic approach to maximize their returns. The secret? They’re pulling a "Peter Thiel" and using Roth IRAs to invest in startups—allowing all gains to be completely tax-free. Here’s why this strategy can be a game-changer for investors:

Tax-Free Growth on Investments When you invest in startups through a Roth IRA, any future profits grow entirely tax-free. This means no capital gains or income taxes—just pure, compounding returns over time. It’s a powerful way to amplify the upside of high-growth investments while keeping more of what you earn.

Accessing Early-Stage Deals on AngelList AngelList has made it easier than ever to invest in startups. With a Self-Directed Roth IRA, you can join startup fundraising rounds directly through the platform, gaining access to early-stage opportunities typically available only to accredited investors. It’s a simple way to get into the startup ecosystem while benefiting from the Roth IRA’s tax advantages.

The Power of Tax-Free Growth in Retirement One of the most compelling features of a Roth IRA is that your investment appreciation becomes 100% tax-free in retirement. Since contributions are made with after-tax dollars, your returns grow without any future tax burdens. This provides long-term flexibility, security, and, ultimately, more wealth when you need it most.

Building Fortunes with Roth IRAs Peter Thiel famously built a $5B fortune by leveraging the Roth IRA’s tax-free growth potential through smart early-stage investments. While this level of success is exceptional, the core principle remains: when you invest early and hold your position over time, your tax-free growth can compound significantly.

A Smart Wealth-Building Strategy Whether you’re diversifying your portfolio into startups or adding a powerful tool to your retirement strategy, Roth IRAs allow you to maximize returns while minimizing tax burdens. It’s a smart way to build wealth over the long term and prepare for the future.

Ready to get started? Join Carry’s Pro Plan and open a Self-Directed Roth IRA today at carry.com.

Disclosure: This article is for informational purposes only and not intended as tax or investment advice. Investing in startups involves risk, and IRAs have specific contribution limits. Always consult a financial professional to determine the best approach for your individual situation.