The Roth IRA (individual retirement account) is another form of a retirement account that allows you to withdraw your retirement earnings tax free. Enough has already been written about it online. I recommend everyone read the summary on the Wikipedia page.
The essence of a Roth IRA is that the money you place in the account has already been taxed at your current federal and state income levels. Any earnings made are withdrawn tax free. There are federal income limits on contributing to the Roth IRA, but there are ways around it. I recommend reading Harry Sit’s summary on his blog: http://thefinancebuff.com/the-backdoor-roth-ira-a-complete-how-to.html He already has a well-written summary on the process.
The premise of contributing using post-tax dollars allows you to diversify your savings and future dollars.
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