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Ask The Expert: Contributions

Q:
Asked by Jordan 7/24/12

What is the difference between the Roth IRA and the Traditional?

Elizabeth MacBride A:
Answered by Elizabeth MacBride 7/24/12
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304 out of 553 people found this useful.

In short, a Roth IRA is funded with after tax dollars while a Traditional IRA is funded with pre-tax dollars (i.e. you get a tax deduction when you contribute). With a Roth, you don’t pay any taxes when you withdraw, because you already paid taxes upfront.

You can read much more detail about the differences between a Roth IRA and a Traditional IRA here.

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