Women & Retirement: Why A Roth IRA May Be Particularly Beneficial

David Treece, MBA, AIF®, CLTC® |
Categories
Women & Investing
Retirement Planning
IRA
Retirement
Saving Strategies

Many are aware that tax-free earnings growth and the ability to pass assets to beneficiaries on a tax-free basis make Roth IRAs a popular retirement savings strategy. 

But, did you know Roth IRAs can be particularly beneficial to women preparing for retirement? 

On average, women tend to live longer than men, so they need to save more for retirement to ensure their income lasts upwards of 25 years. However, because women tend to make less money over the course of their careers, their overall savings rates tend to be lower than men. That’s where a Roth IRA can help.

How Can a Roth IRA Help?

  • You can contribute up to $6,500 per year ($7,500 if you’re 50 or older).
  • Money is contributed after tax, so when you make a distribution, you’ll receive the funds without penalty.
  • Roth IRAs allow account owners to contribute as long as they work, regardless of age.
  • Unlike Traditional IRAs, Roth IRAs aren’t subject to required minimum distributions (RMDs), which means your assets can keep working hard for you for a longer period of time.

Schedule a time to chat if you’d like to learn more about Roth IRA benefits and your eligibility. We're here to help.

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A Roth IRA offers tax-free withdrawals on taxable contributions. To qualify for the tax-free and penalty-free withdrawal of earnings, a Roth IRA must be in place for at least five tax years, and the distribution must take place after age 59½ or due to death, disability, or a first time home purchase (up to a $10,000 lifetime maximum). Depending on state law, Roth IRA distributions may be subject to state taxes. Converting from a traditional IRA to a Roth IRA is a taxable event.