Good News for Retirement Planning

Seems like there's rarely much good news on the tax front. But there is one clear exception: The Roth Individual Retirement Account (IRA). Many people agree that its benefits outweigh the Traditional IRA's. So if you don't yet know Roth, it's time to get acquainted.

Make Roth Part of Your Plan
Roth probably deserves a place in your plan if you qualify. (You qualify if your Adjusted Gross Income is below $156,000 (2007 limit) for joint filers, and below $99,000 (2007 limit) for individual filers.) In fact, there are only a few times when it might warrant second thoughts. The best example is if your employer offers a tax- deferred retirement matching program--and you're not maximizing the matches.

What Makes the Roth Superior for Many Investors?
The primary advantage to the Roth IRA is that you typically don't pay taxes upon withdrawal. The disadvantage? You don't get to deduct your contribution from current income. Over the years, though, the Roth usually wins out. In fact, the Roth's benefits are so superior for many investors that many people are enacting Traditional IRA to Roth IRA rollovers. It's complex, but often worth it. Ask your Financial Consultant.

For more details about the Roth IRA, check out the links in the Related Information section.