Roth IRA vs Traditional IRA?

Watch my video to learn the difference between Roth and Traditional IRA’s

When choosing between a Roth IRA and a Traditional IRA, it’s important to understand the key differences and benefits of each.

Both are types of individual retirement accounts in the United States that offer tax advantages, but they differ in how and when you get those tax benefits.

In Traditional IRA’s anyone with earned income can contribute, but the tax deductibility of contributions may be phased out at higher income levels if you or your spouse are covered by a retirement plan at work. For Roth IRA’s contribution eligibility is subject to income limits. For 2024, the ability to contribute phases out for single filers with modified adjusted gross incomes (MAGI) over $153,000 and married couples filing jointly with MAGI over $228,000.

Both types of IRAs can play a vital role in a diversified retirement strategy, and some people even contribute to both, if eligible, to balance the tax advantages of each.

-Steve

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