Opened a Roth...

[nate]

So last week I opened a Roth IRA (due to Jeffrey's constant nagging )

I opted to do the minimum $1000 a year for now but will probably do the max $3000 next year. Anyways, it's a good thing I chose to do $1000 as they decided to withdraw all $1000 at once rather than monthly payments like I had thought they would! 2 days earlier I had just paid 2 months rent at the place i'm at so needless to say i'll be a little poor this month till pay day

All I know is I better be a healthy guy at age 60 so I can enjoy a Roth retirement! Curious how many people have Traditional IRA's or Roth IRA's?

[2moretrees]

Re: Opened a Roth...

You forgot combination of several of the above which will hopeefully be funding my retirement

[marla]

Re: Opened a Roth...

Can someone please explain the difference between a Roth IRA and a traditional IRA in very easy terms (I'm not very good with financial terms) that maybe a 6 year old could understand. Thank you.

[jeffrey]

Re: Opened a Roth...

The basic difference between the 2 IRAs is the way they are taxed

1) Standard IRA: A standard IRA lets you take a tax deduction the year you make the donatiotion to it. The money then grows tax free until you take the money out when you retire. At that time, all the interest you earned is taxed.

2) Roth IRA: In this IRA you do not get to take a tax deduction the year you make the donation. The money then grows tax free until you take the money out when you retire. At that time, you do not have to pay any taxes on the interest you earned.

That is the basic difference...there are some other details, but I think your were looking for just a basic answer. If you would like more detail, just let me know.

[Tree0164]

Re: Opened a Roth...

I had a 401k at my former job that is now in a traditional rollover IRA. I also have been funding into a Roth as well.

Hubby has a 401k, and a traditional rollover IRA.