With a Roth IRA, you contribute money after paying taxes, your money grows tax-free, and you can generally make tax-free and penal-free withdrawals after age 59½. With a traditional IRA, you contribute money before or after paying taxes, your money grows with deferred taxes, and withdrawals are taxed as current income after age 59½. With a Roth IRA, you can keep your money as long as you want and let it grow and grow as you age. On the other hand, with a traditional IRA, you should start withdrawing money when you turn 70 and a half years old.
With traditional IRAs, you delay paying taxes until you withdraw funds from your account later in retirement. However, with Roth IRAs, you pay taxes in advance by contributing money after paying taxes, and later, during retirement, your withdrawals are tax-exempt (as long as your account has been open for at least five years). If you expect to be in a lower tax bracket during retirement, a traditional IRA might make more financial sense.
