In a 2006 survey conducted by the Employee Benefit
Research Institute, even though 73 percent of retirees indicated that they
think they will have enough money for a comfortable retirement, 42 percent
admitted that they are more concerned about their financial future.
Many workers today have unrealistic expectations about how much income they
will need to maintain a comfortable lifestyle in retirement. Your
retirement, like any other time in your life, may be marketed by financial
ups and downs. A well-thought-out strategy, including an individual
retirement account (IRA) can help you stay on a path toward a comfortable
retirement.
Traditional
IRA or Roth IRA
What's the Difference? Tax Deductions or Tax-Free Earnings?
Traditional IRA - The traditional IRA is an
account which allows you to defer taxes on your earnings until they are
withdrawn. Also, certain contributions are tax deductible in the year they
are made.
Roth IRA - The Roth IRA is a nondeductible account
that features tax-free withdrawals for certain distribution reasons after a
five-year holding period. Since Roth IRA contributions are nondeductible and
taxed in the year they are earned, people, who expect to be in a higher tax
bracket when they retire may benefit more from these accounts than from a
traditional IRA.
Talk with a
Baylake Bank Customer Service Representative
near you for more information about the IRA that's right for you.
Consult your tax advisor.