What You Need To Know In 2024 About A Roth IRA

Many well-meaning people take the benefits of a Roth IRA for granted. With the tax benefits of a Roth IRA, modest contributions over long periods can translate into a substantial amount of tax-free income throughout your entire retirement. Those with the highest incomes may dream of the potential for a significant amount of tax-free retirement income, but they often earn too much income to be able to contribute to this type of retirement account. And sadly, their wealth managers are usually too lazy to set up these accounts for them when they are eligible to contribute. The responsibility to set up and fund a Roth IRA falls squarely on the rest of us.

Roth IRA Basics For 2024

A Roth IRA is one type of tax-advantaged retirement account. Unlike a traditional IRA or 401(k), you will not receive a tax deduction for your contributions to a Roth IRA. However, your investments inside a Roth IRA will not only grow tax-free, but they can also be withdrawn tax-free during retirement. (That’s assuming you follow a few basic Roth IRA rules).