Retirement Thread

[Macroach]

Originally Posted by 2bikemike

A Roth is pre tax dollars. So there is no tax on withdrawals. Your money grows tax free. A traditional IRA is pre tax dollars so every withdrawal is taxed.

I think you meant to say the Roth is post-tax, while traditional IRA is pre/tax contributions.

Just a few ideas from this old guy:

- If possible, contribute as much as you can to the Roth. The money can grow to a billion dollars and you will not be taxed on any of the gains when you withdraw.

- Roth is a great vehicle because you can withdraw your PRINCIPAL contributions tax free (since you paid taxes on that one already). So for example if you contributed $100k, and it grew for several years, you could then withdraw any of the $100k without early withdrawal penalties or taxes.

- Look into the “backdoor” IRA -> Roth conversion. (Insert obligatory CP joke here). Or the “mega”Roth backdoor conversion. If they’re still around. Been awhile since I researched those.