Roth Accounts are Great…but are They Right for You?

A Roth IRA (or 401k) offers tax-free withdrawals in retirement, making it an attractive savings option. However, determining if it’s the right choice for you depends on several factors.

Evaluate Your Financial Situation:If you’re in a lower tax bracket now, contributing to a Roth IRA can be advantageous, as you’ll pay taxes upfront and avoid them in retirement. If you anticipate being in a higher tax bracket in retirement, a Roth IRA can be even more beneficial, as you’ll avoid paying taxes on withdrawals.

Consider Your Income:There are income limits for contributing to a Roth IRA. If your income exceeds these limits, you may not be eligible to contribute directly. If you exceed the income limits, you might still be able to contribute to a Roth IRA through a backdoor Roth conversion. However, this involves converting traditional IRA contributions to Roth IRA funds, which can trigger taxes.

Consider Your Retirement Goals:Roth IRAs are excellent for long-term savings and retirement planning. If you plan to retire in a higher tax bracket, Roth IRAs can provide tax-free income, reducing your overall tax burden.

Consult with a Financial Advisor:A financial advisor can help you assess your financial situation, evaluate the benefits of a Roth IRA, and determine if it’s the right choice for your retirement goals.

Hendricks Wealth & Estate Management will be speaking further on this topic during a FREE “When You’re Ready, We’re Ready” webinar on Wednesday, November 6, 2024 at 5:30 p.m. CST.

To reserve your spot or learn about future “When You’re Ready, We’re Ready” financial sessions, visit www.jghfs.com/events. Questions? Call us at 847-428-3997.

Services offered through J.G. Hendricks Financial Services, LLC dba Hendricks Wealth and Estate Management, a Registered Investment Adviser.  This article is for informational purposes only, and not intended as advice regarding any specific investments.

Hendricks Wealth & Estate Management

650 Spring Hill Ring Rd., Ste. 2000

West Dundee, IL 60118

(847) 428-3997

www.jghfs.com