Is a Roth IRA for You?
More and more Americans are choosing to put money into Individual Retirement Accounts (IRAs). There are two basic types of IRAs:
- Traditional IRAs, which offer tax-deferred growth, a tax deduction potential and a variety of investment options; and
- Roth IRAs, which allow for tax-free distributions at retirement, a variety of investment options and features that enable investors to leave a legacy for their heirs.
Most experts agree that a Roth IRA is the better option, but unlike a traditional IRA, there are certain requirements one must meet to contribute to a Roth IRA. To invest in a Roth IRA, you must have a modified gross income under $184,000 (married couples) or $117,000 (singles).
Roth IRA contributions are not tax-deductible, but the earnings grow tax-free if you don’t take any distributions until you reach age 59½ or older and you have owned the account for a minimum of five years.
When you retire, you have the option of withdrawing all of your funds at once, or leaving them in place for your children and grandchildren. No matter what, when funds are withdrawn, no income tax will be owed.
To decide for sure if a Roth IRA is for you, talk to a National Iron Bank customer service representative today.