What is a Roth IRA?
A Roth IRA is an individual retirement account that allows you to contribute after-tax dollars, with the benefit of tax-free growth and tax-free withdrawals in retirement, provided certain conditions are met.
Key Features:
- Tax-Free Growth: Earnings and qualified withdrawals are completely tax-free.
- After-Tax Contributions: Contributions are made with money you’ve already paid taxes on, so there’s no upfront tax deduction.
- Qualified Withdrawals: Withdrawals of contributions are always tax-free. Earnings can be withdrawn tax-free if the account has been open for at least five years and you are age 59½ or older, disabled, or deceased.
- Contribution Limits: Annual contribution limits apply and may change each year. Income limits may restrict eligibility for direct contributions.
- No Required Minimum Distributions (RMDs): Unlike Traditional IRAs, Roth IRAs do not require withdrawals during the account holder’s lifetime.
- Flexible Investment Options: With Imagine IRA, you can invest in a wide range of assets—including real estate, private equity, precious metals, and more.
Who Should Consider a Roth IRA?
- Individuals who expect to be in a higher tax bracket in retirement.
- Those seeking tax-free income in retirement.
- Investors who want flexibility and control over their retirement assets.
