In the United States, we can't talk finances without talking taxes. It shouldn't come as a surprise that taxes are an inevitable part of our reality and are inescapable. The best (and only) way to go about navigating taxes is to, as Stephanie and Kevin like to say, "be smart about it, know what's going on, then make your decisions."

 

 

A Roth IRA is a tool that falls under the category of tax planning. So, it's vital to be aware of exactly what it is and how best to make use of it depending on your circumstances and goals.

 

 

"What's a Roth IRA, anyway?" you may ask. Basically, it's a special retirement account that was created in 1997 by Senator William Roth as part of one of the tax reform acts that get passed periodically. One of the primary differences between the Roth and the traditional IRA is that, unlike the traditional IRA, you are not taxed on the dividends you earn from the Roth.

 

 

Listen in and learn other notable differences between the traditional IRA and the Roth IRA, the rules around taking money out of a Roth, three scenarios in which one would want to open a Roth IRA; and how to prepare your Roth savings for your next of kin.

 

 

Key Topics:

"What the heck is a Roth IRA, anyway?" (3:06)

Differences between the traditional IRA and the Roth IRA (5:35)

Can you really take money out of a Roth IRA whenever you want? (14:49)

The five-year clock for IRA accounts (18:40)

Why even open a Roth IRA? (23:05)

Leaving a legacy: Passing on your Roth money to the next generation (32:47)

What is the "deathbed Roth conversion" strategy? (35:22)

Ultimately, what are your priorities? (37:24)

 

 

Check out Kevin's video here: https://www.youtube.com/watch?v=lloGStTwFdw

Check out our previous episodes for more information on this topic.

12: What Women Need to Know About IRAs with Sarah Brenner

• https://podcasts.apple.com/us/podcast/12-what-women-need-to-know-about-iras-with-sarah-brenner/id1534658342?i=1000509034189

15: What Women Need to Know About Social Security

• https://podcasts.apple.com/us/podcast/15-what-women-need-to-know-about-social-security/id1534658342?i=1000514954805

 

If you like what you've been hearing, we invite you to subscribe on your favorite platform and leave us a review. Tell us what you love about this episode! Or better yet, tell us what you want to hear more of in the future. [email protected]

 

 

You can find the transcript and more information about this episode at www.takebackretirement.com.