Overview of Retirement Accounts
401(k), 403b, 457 and other types of retirement accounts usually have either the traditional IRA option or the Roth IRA option. What’s the difference between the two? It has to do with when you pay taxes. In a traditional retirement account, you’re going to put money into it today without paying any taxes, and you’re going to pay taxes on any amount you will withdraw from it at a later point. With a Roth account, you’re going to pay taxes today and all of the growth will be tax-free – you’ll never have to pay taxes on it again. The question is, which is better? To pay taxes now or to pay taxes later? Listen in.