Roth
Roth
WHAT IS A ROTH?
Unlike the traditional IRA, there are no age restrictions for making Roth contributions, as long as you have earned income. Which makes this a great investment vehicle to consider for investors just starting to work. Roth IRAs are funded with after-tax money, but grow tax-free until the funds are distributed. Distributions are tax-free as long as you have owned the account for at least five years and are over age 59½. Other qualifying events include death, becoming disabled, or being a qualified first-time home buyer using the distribution for the purchase of a primary residence.

IS A ROTH IRA OR A TRADITIONAL IRA THE RIGHT CHOICE FOR ME?
Each individual investor will have different circumstances and so to determine if a Roth is right for you depends. “A Roth account is a good choice if you are young and in a low tax bracket.” says Debbie Craig
Your particular circumstances regarding:
- Eligibility – your employment status may determine which IRA type is a better fit
- Catch Ups – depending upon your age you may be eligible to increase your annual contribution
- Penalties – certain distributions are not subject to an early penalty withdrawal
- Deductibility – you may be able to deduct your contribution for tax purposes
- Taxation – your current tax rate may determine which IRA type is the best fit
- Transferability – need to have a conversation about your 401(k) or other qualified plan?
- and more!
will also determine which retirement tool fits optimally into your plan.
Click here to learn what the contribution limits are for a Roth IRA.
If you are unable to contribute to a Roth due to income restrictions or you believe your tax rate is lower now than it will be in retirement, you may want to consider a Roth conversion. Contact me to discuss if a conversion is right for you.