1 Major Reason I Prefer a Roth Account for My Retirement Savings
I've been investing my retirement funds into Roth accounts for over a decade. While traditional retirement accounts are a great choice for many, there's one reason why I love Roth accounts. Hint: It's not just the tax savings.
Many people love Roth accounts because they are funded with post-tax dollars. That means you invest money into these accounts that you've already paid taxes on. So, you pay taxes on the money today, but then that money grows tax-free forever, even when it comes time to withdraw.
Traditional IRAs or 401(k)s, meanwhile, are funded using pre-tax dollars. That means you don't have to pay taxes on the earnings today, and you don't have to pay taxes as the money grows, either. But when it comes time to withdraw, the tax bill will finally come due.
Source Fool.com
