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Benefits of Roth IRA

Time is essential in preparing for your future. You parents send you to school because they dream of a secure, if not lucrative, future for you; and they expect you to earn your college or university degree before you turn 25. By then, you become self-sufficient and could actually start thinking of having a family of your own. In your first five or even 10 years in the professional world, you probably do not mention or even think of the word “retirement”. Most likely, you find yourself contented with the government’s Social Security program; or maybe you still feel too young to even think about retirement. Preparing for retirement is not age-based. The earlier you choose a retirement account, the more chances you get in having the best retirement years. Enjoy your earnings now; but it is best to also invest a certain amount for the future.

You may have a work-based 401(k), but you may also consider Roth Investment Retirement Account. What is a Roth IRA? It is a special type of retirement plan which specifically aims at granting tax break not on the money deposited but on the money withdrawn upon retirement. It could therefore be said that Roth IRA withdrawal is tax and penalty free with a condition that such withdrawal is a qualified Roth IRA distributions. In order to have qualified Roth IRA distributions, you should start taking money from your account when you reach the age of 59 ½ years old as long as your account is at least 5 years old already. If you opt not to touch any amount of contributions to your Roth IRA account, you may do so even until you reach the age of 70 ½ years. This is because under Roth IRA, there are no forced distributions. If you die before withdrawing your retirement income, your beneficiaries simply inherit your Roth IRAs.

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