Looking for a surefire wealth builder? Open a Roth IRA. You fund this retirement account with after-tax dollars, so the pain is up front. The payoff? Withdrawals are tax-free if you're at least 59? and have held the account for at least five years. But wait, there's more. Let's talk!
One element of the Roth IRA that may spark questions from taxpayers is the issue of converting an existing deductible Individual Retirement Account (IRA) into a Roth IRA. Perhaps one of the more important factors in your decision on whether or not to convert to a Roth IRA is how you will choose to pay income taxes at the time of conversion.
Not working. That may not be an issue. Find out!
You’re certainly not alone if the words Individual Retirement Account (IRA) cause your mind to spin in confusion. The original IRAs were mind-boggling enough. However, now you have several options, including what many have called the “American Dream” IRA—the Roth IRA. Let’s take a moment and ferret out some of the nuances on the IRA landscape.