Dec 26

What are the benefits of contributing to a Roth IRA if it is not tax deductible? I am 68 and participate in SEP at work so what if I just put $5,000 into any kind of investment account and forget about the rules and regulations of an IRA since I’ll be retiring in the next 5-6 years?

3 comments so far...

  • Mr. Prefect Said on December 26th, 2009 at 1:03 pm:

    When the day comes, and you begin taking out money from the Roth, all of it will be tax free.

  • bud68 Said on December 26th, 2009 at 1:33 pm:

    Tax-free compounding/earning on the Roth investments. The younger you are, the better deal a Roth is.

  • belbiv1 Said on December 26th, 2009 at 1:50 pm:

    well the benefit is that when you are younger and you contribute to a Roth your true value of your account is what you have at retirement. If you have 50k at 60, you have 50k with no mandatory distributions and no taxable money. That is the drawback of an IRA. Yes you can deduct it off your taxes before 60 but they will make you take distributions at 60 and tax you accordingly.

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