Roth IRA's have a few key features that are different than traditional IRA's. The most obvious is the way the money is withdrawn after retirement age of 59 1/2. Contribution are post tax dollars and withdrawals are tax free.
You can also withdraw contributions for any reason throughout the life of the account, but not gains, tax and penalty free. And if you have owned the account for 5 or more years then withdrawals after retirement age are all penalty and tax free.
The downside is that not everyone qualifies to open this account, and post tax contributions cap out at $5000 a year. To qualify a single person must not have income of over $120,000 after adjusted gross income. And if you are filing joint the maximum income is $176,000 adjusted gross income.
In summary, the reasons why you would want to have a Roth IRA instead of a traditional or non-deductible are: if you plan on your retirement tax bracket to be higher than it is now, if your adjusted gross income is under $100,000 and you have a traditional IRA that you'd like to roll over, and if you'd like tax free growth.
Here’s an Opportunity to Consult with a Professional Financial Advisor, Without Any Cost or Obligation!
Life Insurance
Annuities
Financial Advisor
Financial Planning
Disability Insurance Quote
Joint Life Insurance Quote
![]() | Charles Stanley Charles Stanley is an author, educator, speaker and Wealth Manager with Capital Financial Advisors, LLC. He regularly presents continuing education for Attorneys (MCLE) and CPAs (CPE) in areas where l... |
![]() | Beau Wolinsky K.C. Capital Management is an investment advisory services firm that specializes in IRA’s, 401k Rollovers, and Life and Annuity products. As an independent investment advisor representative my fiduc... |
![]() | Peter Merrick Peter J. Merrick, B.A., FMA, CFP, TEP, FCSI is the President of MerrickWealth.com. Since the early 1990s, Peter has had an active career in the financial planning, investment, risk management, estate,... |
![]() | Barry Fine Barry M. Fine has spent his career serving the complex financial needs of business owners, high net worth individuals and families as a financial planner and private wealth advisor. He specializes in ... |
![]() | Barry Walter Certified Senior Advisor licensed in South Carolina, North Carolina and Georgia. Previously employed by The National Broadcasting Corporation, I worked on The Today Show and The Huntley Brinkle... |
![]() | Norm Trainor Norm Trainor is the founder and CEO of The Covenant Group. He is an international speaker, the author of the best-selling book, The 8 Best Practices of High-Performing Salespeople, and a consultant to... |
![]() | Jerry Crutchley, and Nancy Coveleskie Enter a personal or business bio here.... |
I opened Roth IRA
I have a business where my children occasionally work and I opened them each a Roth IRA to put all of their earnings for their future. It's grows tax free and it doesn't matter how young they are, my youngest is 5 years old. It's working out really well.