Some other tips about the Roth IRA are:

  • You can make contributions at any age.
  • You are not required to take a “mandatory distribution” from a Roth (Traditional IRA account holders must start withdrawing money at 70 ½).
  • A non-working spouse can open a Roth IRA based on the working-spouse’s earnings (and the couple’s tax filing status).
  • You can still make your annual contribution if you also convert money from a tax-deductible account (like a traditional IRA) to a Roth in the same year.
  • You can contribute to a Roth even if you participate in a retirement plan through your employer.

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What is a Roth IRA?

The Roth IRA is a individual retirement account that offers an invaluable asset for the future: TAX-FREE income in retirement. How does this work? Well, the benefit of a Roth IRA is all up to the policy holder and it all depends on the beholder’s tax bracket--both currently and then also when he or she enters into retirement.

Even though there is no immediate tax break for Roth IRA contributions as there is with a Traditional IRA, Roth payouts are TAX-FREE when you abide by the rules. And because the money you contribute to your Roth is after-tax money, you can withdraw (from your contributions, not your growth) whenever you need to, want to, or have to!

Roth IRAs are great for anyone looking for a way to have a steady income during retirement.  For more mature, wealthier tax-payers who wish to leave a TAX-FREE asset to their heirs, the Roth IRA creates a safe haven for wealth preservation. For younger individuals who most likely will be in a higher tax bracket during retirement, the Roth IRA can save thousands of dollars in taxes and provide a steady stream of extra income, TAX-FREE. 

Anyone can start at any age to contribute to a Roth IRA, if you have earned income from a job, and you fall within the other guidelines. Are you are ready to start building tax-free income for your retirement today?