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-   -   Roth vs traditional IRA (https://www.askmehelpdesk.com/showthread.php?t=229141)

  • Jun 20, 2008, 08:50 PM
    lnza4
    So with a roth Ira you only pay if the roth grows... on the IRA you pay a penalty? Is there a limit on each one?
  • Jun 21, 2008, 05:16 AM
    ScottGem
    First its not a good idea to piggyback your question on someone else's. This can lead to confusion. You should start a new thread. So I've moved your question to its own thread.

    The difference between a Roth IRA and a traditional IRA is that the Traditional IRA is funded with pretax dollars so the money in it has never been taxed. The rationale is that you will be in a lower tax bracket when you start taking the money out.

    A Roth IRA is funded with post tax dollars, so you have already paid taxes on the money. However, the income earned on a Roth IRA is TAX FREE. So you do not pay taxes when you withdraw it.

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