Current Events > Are Roth IRAs better than the regular kind?

(+) Yeah! (+)

I always hear talk about them, but I never understood the point. I mean, you're still paying tax on the money. The only thing different is when you pay it. :v So why bother?
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they have different tax laws.

ROTH = you pay taxes and then invest it. When you withdraw you don't pay additional taxes.

Traditional = you pay no taxes when you invest it. When you withdraw you pay the taxes owed then.

Not necessarily better, it depends on the individuals tax situation and what they predict their income will be like in retirement.
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It's better to invest in a tIRA while you're young if your eligible for the full tax break and invest the remaining in a taxable brokerage account. When you retire your income will be lower so at that point you convert your tIRA into a Roth IRA and incur a smaller tax penalty (because your income is lower). After converting you can withdraw from the Roth IRA tax free.

If you think you'll make more money, or that tax rates will be higher, when you retire vs now, Roth will be better.
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For the most part, the main difference lies not with the account itself but what kind of savings you already have. For example, you can roll things like HSAs and 401ks into IRAs and back for the purposes of investment strategy and such.

If you just want to put money away and don't care about it until retirement, the regular IRA is probably better as the tax rate when you're a senior is likely going to be lower than what you're paying now.
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