In life, you often get second chances — and the same is true with investing. To illustrate: You might not have been able to contribute to a Roth IRA during your working years due to your income level, but you may get that opportunity as you near retirement, or even when you are retired — through a Roth conversion.
Why is a Roth IRA desirable for some people? Here are the key benefits: Tax-free withdrawals — You put in after-tax dollars to a Roth IRA, so you can withdraw your contributions at any time, free of taxes and penalties. And if you’ve had your account for at least five years and you’re at least 59½, you can also withdraw your earnings free of taxes.
No RMDs — With a traditional IRA, you’ll have to start taking withdrawals — called required minimum distributions, or RMDs — when you turn 73, or 75 if you were born in 1960 or later. But there’s no RMD requirement with a Roth IRA — you can essentially leave the money intact as long as you like.
