What is a Roth IRA?

A Roth IRA is an individual retirement account (IRA) that allows you to make tax-free withdrawals in retirement. While you do not draw any current-year tax benefits, your contributions and earnings grow tax-free which can be withdrawn tax and penalty-free once you reach 5912 years of age and if your account has been open for five years.

What Benefits Do A Roth IRA Offer?

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Early access to money

You can make early withdrawals, without penalties, from a Roth IRA, provided it is a qualified expense. Some examples of qualified expenses are disability, higher education, first-time home purchases and certain unreimbursed medical expenses.

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No age limits

You can put money in your account for as many years as you want, as long as you have qualifying earned income.

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Tax-free retirement income

Under a Roth IRA, if your account has been open for 5 years and if you are 5912 or older, you can withdraw your money without owing any federal taxes.

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No RMDs

Unlike traditional IRAs, there are no Required Minimum Distributions (RMDs) for Roth IRAs during the account owner's lifetime. Your account's beneficiaries may need to take RMDs to avoid penalties.

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No taxes for your heirs

You can pass your Roth IRA on to your beneficiaries, and their qualified withdrawals will be tax-free.

Are you ready to retire?

Use the calculators below to find out.

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