Retirement Planning : How Does a Roth IRA Compound Interest?

A Roth IRA compounds interest by growing without taxation, and the individual gets to decide when to take it out. Find out how Roth IRAs work with help from a licensed insurance agent in this free video on retirement planning and personal finance. Expert: William Rae Contact: www.hbwfl.com Bio: William Rae has been licensed in the insurance and financial fields for more than 30 years. Filmmaker: Christopher Rokosz

Comments

1. would the investment in IRA be taxed when I decided to take them out?
2. Lets look at this with numbers: Assume 10% taxation (cause 10 is nice and easy) 10% tax on 10 kernels = 1 Kernel leaving you with 9 to grow. each kernel yields 1000 kernels (yay!) At the end you get 9000 Kernels - Tax free (Yay!! 9K!) Now, lets say Traditional, 10 kernels, no tax... You plant them and get 10K Kernels but then are taxed 10% leaving you with.- 9K SAME! So... Reasons for roth IRA: 1) Can remove contributions any time without penalty. 2) Best if taxed at HIGHER RATE Later...