Roth IRAs can be good savings options for anyone who expects to be in a higher tax bracket in the future, making tax-free withdrawals even more favorable. All the same, there are income limitations to opening a Roth IRA, and not everyone is eligible for this type of retirement account. So, understanding how to unlock your Roth IRA's full potential is key.
Roth IRAs are individual retirement accounts that let you save for retirement with after-tax dollars. Since taxes are paid on contributions before they’re placed in the account, withdrawals from a Roth IRA can be made tax-free at a later date. And since the IRS increased contribution limits on Roth IRAs, you can save even more than in previous years. This year, you can contribute up to $7,000, as well as an extra $1,000 in catch-up contributions.
