How to Maximize Your Roth IRA — and Retire Rich

When the late US Senator William Roth, a champion for tax relief, saw his namesake retirement accounts become reality in 1997, he spoke of how Roths would help “hard-working, middle-class Americans.” And so they have. But over the years, these savings vehicles have also become a popular choice for wealthier savers and investors hoping to manage future tax bills.

The enduring appeal of a Roth retirement account lies in its simple premise: pay taxes today to avoid them tomorrow. Contributions are made with after-tax dollars, on which earnings grow tax-free. With US income tax rates near historical lows, a Roth is a hedge against the possibility of higher taxes in the future, and the accounts provide flexibility in controlling one’s tax bracket down the line, said Craig Toberman of Toberman Becker Wealth.1