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In contrast, the Roth IRA presents a different set of advantages, primarily concerning taxation upon withdrawal. Contributions to a Roth IRA are made with after-tax dollars, meaning you do not receive a tax deduction at the time of deposit. However, the major benefit of a Roth IRA is that once you retire and start taking money out, all distributions—including any growth—are tax-free.
This fundamental difference raises an important question for individuals: which type of IRA is more beneficial? Is it the immediate tax savings provided by the Traditional IRA, or the long-term tax-free growth of the Roth IRA?