Roth IRA

What makes a Roth different?

Do you think taxes when you retire will be higher or lower than they are today? If you suspect that taxes – and specifically, your taxes – are likely to be higher when you retire, a Roth IRA may be a good option for your retirement savings. The money you contribute to a Roth today has already been taxed, so when you retire and start withdrawing, the money – and any potential growth in the account – may be tax free. And Roth IRAs offer a lot of flexibility even before you retire.

How much you can contribute

You can contribute money to a Roth IRA as long as you (or your spouse) have taxable compensation. How much you can contribute depends on your modified adjusted gross income (MAGI). 

MAGI Roth IRA Contribution Limits
How You File Your Taxes
2015 MAGI
Less than $116,000
$131,000 or more
Married Filing Jointly
Less than $183,000
$183,000 - $192,999
$193,000 or more
Married Filing Separately
$1- $9,999
$10,000 or more

A "full contribution" for 2015 is $5,500. And if you're 50 or over, it's $6,500 because the IRS lets you contribute an additional $1,000. This is called a "catch up" contribution.

If you qualify for a partial contribution, your financial advisor can help you determine how much you can contribute.

If you are not eligible to make a contribution at all, a Roth IRA isn't out of the question. You may still be able to take advantage of tax-free income in retirement with a Roth conversion. Please consult with your tax advisor.

Investments you can choose

Inside your Edward Jones IRA account, you can choose from a variety of investments – stocks, bonds, certificates of deposit (CDs), mutual funds, ETFs, UITs and more.

When you can take money out

You're generally not taxed or penalized when you withdraw your Roth IRA contributions and earnings. However, if your Roth IRA account is not at least 5 years old or if you're not yet 59 ½ years old, the earnings portion of the withdrawal may be subject to taxes and a 10% penalty, unless an exception applies. 

And unlike with Traditional IRAs, the IRS does not require the original account holder to take any required minimum distributions (RMDs) from your Roth IRA when you reach age 70½. You control when you want to withdraw your money. If you don't need the money in your Roth, you can leave it alone and it may continue to be tax free – and so will any potential growth.

How we can help

To open a Roth IRA, talk with your local financial advisor.

Find a Financial Advisor

Find a Financial Advisor

Select a State and then enter a last name

    Are you saving enough to send your child to school?

    Use this calculator to plan, prepare or check in on your progress.

    Use our calculator

    Are you tax-smart?

    Incorporate tax-smart investing ideas into your year-round financial strategy.

    Read more