Guest LaTishaJoy Posted January 4, 2001 Posted January 4, 2001 What is the tax benefit of opening up a ROTH IRA and would investing 4000 vs 2000 make a difference by Apr 16?
Michael Devault Posted January 4, 2001 Posted January 4, 2001 The main tax benefit of a Roth IRA is that the interest earned by the Roth IRA can eventually be taken out income tax free. This is a unique feature, since most other alternative methods of saving money require you to pay taxes on interest earnings. If you contribute $4,000 now, it would cover your contribution for 2000 and 2001. The advantage of making your 2001 contribution now is the extra time to earn interest on it. Over a number of years, compounding of this interest can make quite a significant difference in your account. Hope this helps. Good luck to you!
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now