Today we will discuss converting to a ROTH and then converting back to a Traditional IRA as mentioned in www.theretirementpros.com. At some point, you are probably going to figure out that tax free money is tax free money, despite whether you may take some temporary losses in the short term.
My advice is to find a way to get your money into a ROTH. If you already have access to one, find a way to fully fund it. If you let your money grow over time, it will be easier to let a small pot of money grow tax free rather than have a larger pot of money grow tax deferred. There is an underlying money concept which states that it is easier to double a smaller pot of money. For example, which would be easier to double 10 dollars or 1 million dollars? Most people could turn 10 dollars into 20 if they focused on making the money double. On the other hand, most people do not have the skills necessary to make 1 million dollars double.
What do you think? To ROTH or not to ROTH?
This post was reposted from http://finlit.biz/retirement-2/should-you-choose-a-roth-ira-or-a-traditional-ira/, originally written on January 25th, 2013.
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