Roth IRA vs Traditional IRA: Pick the Right One for Your Age

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Both are great. Both have $7,000 contribution limits in 2026 ($8,000 if 50+). The difference comes down to one question: when do you want to pay taxes?

Roth IRA: Pay Tax Now, Withdraw Tax-Free Later

Contributions are after-tax dollars
Growth and withdrawals are tax-free in retirement
No required minimum distributions (RMDs)
Withdraw contributions (not earnings) anytime without penalty

Income limits 2026: Phase-out begins at $146k single / $230k married filing jointly.

Traditional IRA: Pay Tax Later

Contributions are pre-tax (or deductible from taxable income)
Growth is tax-deferred
Withdrawals taxed as ordinary income
Required to start withdrawing at age 73

Deduction limits 2026: Phase-out for those with workplace plans begins at $77k single / $123k MFJ.

The Age Heuristic

Under 30: Roth almost always. Your current tax bracket is probably lower than retirement.
30–50: Depends on income, marital status, retirement goals. Often split between both.
50–65, high earner: Traditional for current deduction often wins.
Already retired but still working: Roth conversion ladders may be optimal.

When Roth Wins Mathematically

You expect higher tax rates in the future
You’re in a low tax bracket today (12% or 22%)
You want to leave tax-free money to heirs
You’ll have other taxable income sources in retirement

When Traditional Wins Mathematically

You’re in 32%+ bracket now
You expect to retire in a lower bracket (especially relocating to no-tax state)
You need the current deduction to fund the contribution itself

The Best Strategy for Most People

Contribute to Roth via the “back door” if you’re above income limits:

Contribute $7,000 to non-deductible Traditional IRA
Immediately convert to Roth IRA
Pay zero tax since there’s no growth yet

Works perfectly if you don’t have other Traditional IRA balances.

Where to Open

Fidelity, Schwab, Vanguard: Best for hands-off index investors
Robinhood, M1, Webull: Easier UI, similar costs
Avoid brokerages charging account maintenance fees — they’re rare but exist

💡 Pro Tip: Maxing both spouses’ Roth IRAs = $14,000/year of after-tax money growing tax-free. Over 30 years at 7%, that’s $1.3M+.