Contributions may be tax-deductible in the year in which they are made. Investments within the account increase with deferred taxes. Retirement withdrawals are taxed as ordinary income. A Roth Individual Retirement Account (Roth IRA) can be a great way to save money for your retirement years.
Like your premium, the traditional IRA, this type of retirement account allows your investments to grow tax-free. It also allows you to withdraw your contributions (but not your earnings) tax-free at any time. You can invest in a traditional IRA no matter how much money you make. The five-year Roth IRA rule states that you can't withdraw your earnings tax-free until at least five years after you've first contributed to a Roth IRA.
Just as IRA rules generally dissuade you from withdrawing your money too early, other rules require you to start withdrawing money from a traditional IRA no later than April 1 of the year following the year you turn 72.