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All about the Roth IRA

The Roth IRA is a retirement savings plan used by millions of people to build wealth over time. It’s a great way to save because it offers tax-free growth. That means the capital gains aren’t taxed every year in a Roth. And when you take money from a Roth in retirement, unlike a “traditional IRA,” that money isn’t taxed, so you have more of every precious dollar.

Some basic points:

Investors use after-tax dollars (unlike a 401(k) that uses pretax money) to fund a Roth IRA account

• Roth gains are not taxed when withdrawn as long as the account has been established for 5 years and you are over 59½

• A traditional IRA is tax-deductible (for some income levels) when it’s funded, but later withdrawals are taxable

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