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What is a Roth IRA?

A Roth IRA is an Individual Retirement Account funded with after-tax dollars. You do not receive a tax deduction for your contributions, but your savings grow tax-free, and qualified withdrawals in retirement are also tax-free.

A Roth IRA is often a suitable option for individuals who expect to be in a higher tax bracket in the future. Paying taxes now can make tax-free withdrawals in retirement more valuable. This type of account is typically well-suited for people early in their careers or for those earning less today than they expect to earn later.

Roth IRAs have income limits, so eligibility depends on your annual income as defined by IRS rules.

Key Benefits of a Roth IRA

Tax-free growth: Your money grows tax-free within the account.
Tax-free withdrawals: Qualified withdrawals in retirement are also tax-free.
Flexibility: You can withdraw your contributions at any time without penalties.