Roth Ira

Written by Joy MacKay
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Chances are you are already more than familiar with the notion of a Roth IRA. These are retirement investment vehicles that generally carry low risk and high returns. Moreover, they are tax free vehicles that can benefit you financially in the long run.

Roth IRA and College Savings

Everyone needs to save for college. With current tuition prices, this can be a daunting task. One of the ways to save for college and maximize your returns is a Roth IRA.

In fact, you can take penalty free distributions from your Roth IRA to pay college tuition and expenses. However, most of the time you cannot take these distributions from the earnings in your account. Because your earnings can be substantial, this feature might make the Roth IRA a poor vehicle for the entirety of your child's college savings.

Roth IRA and Home Ownership

Another popular use for the Roth IRA account is to save funds for the purchase of a home. Similarly to the college savings account, the Roth IRA can be used as a great vehicle for saving for a home. In fact, the best part of using your Roth IRA to save for a home is that you can take tax-free distribution from the account's earnings.


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