Retirement Realities
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Hard road to retirement for junior boomers

To Roth or not to Roth?
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To Roth or not to Roth?

Why did George Mallory want to explore Mount Everest? Because it's there. You should have the same attitude about Roth retirement plans.

Roth IRAs, Roth 401(k)s and Roth 403(b)s -- self-funded contribution plans where you put your money in a retirement account -- don't provide the immediate tax-deductions that their non-Roth cousins do. That's because you pay taxes on Roth contributions now. But the benefit is, you don't pay taxes on Roth distributions when you take them in retirement.

Just as Mallory never conquered Everest, however, a Roth account may not work for you. A lot depends on your age, your current tax bracket and your expected tax bracket later. Bankrate's online retirement calculators can help you crunch your numbers quickly.

You don't necessarily have to decide right away. A traditional IRA can be converted to a Roth variety later, and under a new 2010 law your company plan may allow you to convert a standard 401(k) account to a Roth variety. But in either case, conversion may result in a hefty tax bill.




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