1. Which one is better for me? By Alex McHardy 1

2.  Make deposits to IRA pre-tax  Tax is paid upon withdrawal (Retirement)  Contribution Limit of $5500 (https://www.fidelity.com/retirement- ira/ira/contribution-limits-deadlines)https://www.fidelity.com/retirement- ira/ira/contribution-limits-deadlines  Contributions lower adjusted gross income 2

3.  Make deposits to IRA after paying tax  IRA grows tax free, no taxes on disbursement  Contribution Limit of $5500  Can withdraw up to $10,000 for first time homebuyer 3

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5.  Traditional started with $5000 (Tax rate of 15%)  Roth started with $4250 ($5000 *.85 = $4250)  Traditional grows faster, but is reduced dramatically by taxes at end.  Assumptions –  7% growth Rate  Tax rate of 15% constant 5

6. 6 http://www.youtube.com/watch?v=QBTt My_zOYs

7.  Depends on current tax bracket and tax bracket in future.  Remember to include current deductions and future deductions.  Side by Side comparison - http://www.rothira.com/traditional-ira-vs- roth- http://www.rothira.com/traditional-ira-vs- roth- 7

8. You are concerned taxes will increase in the future You can max out the full contribution limit You are not worried about reducing AGI to stay in certain tax bracket You are younger and/or you believe future income will be higher Choose Roth IRA if… 8

9. You believe taxes will decrease in future You cannot quite max out contribution limits You can take advantage of lowering AGI to drop to lower tax bracket You are older or believe income will decrease in the future Choose Traditional IRA if… 9