Traditional vs. Roth IRA

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Traditional IRA

Roth IRA

Tax Advantages*

Tax-deferred growth potential.You generally pay taxes when you make withdrawals, at which time you may be in a lower tax bracket.Your Traditional IRA contributions may be tax-deductible if you or your spouse does not participate in an employer-sponsored plan.

Tax-free growth potential.You pay no taxes when you make qualified withdrawals after age 59½ and your account has been open at least five years.

Eligibility

Age	You must be under age 70½ and have earned income in order to make Traditional IRA contributions.	No age restrictions, but you must have earned income in order to make Roth IRA contributions.
Maximum Income	No restrictions on eligibility to contribute, but possibly on deductibility.	Not eligible if your MAGI is over $125,000 for single filers and $183,000 for joint filers for 2012. 2013 limits are $127,000 for single filers and $188,000 for joint filers.
Minimum Income	Earned income must be equal to or greater than your annual Traditional IRA contributions.	Earned income must be equal to or greater than your annual Roth IRA contributions.

Maximum Contributions

2012 / 2013

$5,000/ $5500 ($6,000/ $6500 if you are 50 or older)

$5,000/ $5500 ($6,000 / $6500 if you are 50 or older)

Workplace-sponsored retirement accounts aren’t the only way to save. You can also stash money in Individual Retirement Accounts.

* Always consult with your tax professional on any potential tax advantages an IRA might make to your taxes.