| Roth IRA |
 |
A
tax-deferred retirement account. But slightly different than a regular
IRA, contributions to a Roth IRA aren't tax-deductible but there is
no tax on withdrawals as long as the taxpayer is age 59½ and the account
has been open for five years.
|
 |
Financial
planners recommend contributing to a Roth IRA if all fully deductible
tax-deferred plans, such as a 401(k), have been funded and the taxpayer
will be in a higher tax bracket after retirement.
Some people argue that a Roth IRA is worth more than a conventional
IRA because withdrawals from it are forever tax-free. |
|
|
|
|
Dictionary
