Which is better: a ROTH IRA or a Traditional IRA? In this video I’ll break down the main differences for you to make sure you open the right account.

Also, with the new SECURE Act when you must receive your required minimum distribution from your IRA has CHANGED! As of 2022 you must take your first required minimum distribution for the year in which you turn age 72 (70 ½ if you reach 70 ½ before January 1, 2020). However, the first payment can be delayed until April 1 of 2020 if you turn 70½ in 2019.

WATCH NEXT ➡️ BEST Investment Accounts Millionaires Use (You Can Too)

Check out the top 5 ETFs to buy for long term investing here:

Check out Average Net Worth By Age 2022 (How Do You Compare?):

Check out this video on 8 BEST Vanguard Index Funds –

Check out my affiliate links below for products I recommend that I’ve used personally or researched enough to know they’re worth your time.

Get Term Life Insurance. Creating an account is free with Haven Life and you can estimate how much you can expect for the amount of life insurance you’re interested in (this is who I got my life insurance policy with).
Haven Life 👍🏾➡️

Recommended personal finance books:
The Total Money Makeover ➡️
The Millionaire Next Door ➡️
The Simple Path To Wealth ➡️

Thanks for checking out my affiliate links above and I’m certain you will be very happy you did. As an Amazon Associate I earn from qualifying purchases….(read more)

LEARN MORE ABOUT: IRA Accounts

INVESTING IN A GOLD IRA: Gold IRA Account

INVESTING IN A SILVER IRA: Silver IRA Account

REVEALED: Best Gold Backed IRA

Investing in an individual retirement account (IRA) is a great way to save for retirement. However, choosing between a Roth IRA and a traditional IRA can be a difficult decision. Understanding the differences between the two types of IRAs can help you make an informed decision about which one is right for you.

The Roth IRA is named after Senator William Roth who sponsored the legislation that created it. Roth IRA contributions are made with after-tax dollars. This means that you pay taxes on the money that you contribute to the account, and you won’t have to pay taxes on it again when you withdraw it. Roth IRA contributions are not tax deductible, but your earnings can accumulate tax-free.

The traditional IRA, on the other hand, allows you to contribute pre-tax dollars. This means that you can take a deduction on your income taxes for the amount that you contribute to the account. Your contributions grow tax-free, but you will be taxed on the money you withdraw from the account at retirement.

The decision of whether to choose a Roth or traditional IRA depends on your current tax bracket and your expected tax bracket in retirement. If you are in a lower tax bracket now than you expect to be in retirement, a traditional IRA may be the best option. This is because you can take the deduction on your taxes now when your tax rate is lower, and you will be taxed on the money you withdraw later when your tax rate is presumably higher.

If you are in a high tax bracket now and expect to be in a lower bracket in retirement, a Roth IRA may be the better choice. This is because you pay taxes on the money you contribute to the account now, when your tax rate is higher, and you won’t have to pay taxes on it again when you make withdrawals in retirement when your tax rate should be lower.

Another benefit of the Roth IRA is that there are no required minimum distributions (RMDs). This means that you are not required to take money out of the account at a certain age, as you are with a traditional IRA. This can be a benefit for those who want to leave their money in the account to continue growing tax-free for their beneficiaries.

In conclusion, deciding between a Roth and traditional IRA requires careful consideration of your current tax bracket and expected tax bracket in retirement. If you are in a higher tax bracket now, a Roth IRA may be the better option. On the other hand, if you are in a lower tax bracket now than you expect to be in retirement, a traditional IRA may be the better choice. Additionally, the Roth IRA is beneficial for those who want to leave their money in the account to continue growing tax-free beyond their lifetime. Ultimately, choosing the right IRA will depend on your personal financial goals and tax situation.