Most of us are knowledgeable about 401k, 403b and IRA. These retirement saving programs help you receive a tax break today on the cash you subscribe to each saving program. When you contribute money to these retirement saving programs, you wind up reducing your taxable income amount for that specific year. You are able to withdraw the total amount after this stipulated by the master plan and you are taxed in line with the prevailing tax rate of the entire year of withdrawal.<br/><br/>However, you can find after-tax saving programs where you are able to contribute money after you have paid Tax savings the income tax. Here you do find yourself paying taxes for the entire year you have made the contribution nevertheless the profit the account is compounded year after year and you are able to start to withdraw the amount of money from the age of 59-1/2.<br/><br/>These after-tax retirement savings are called Roth IRA and the best part is that you are not taxed once you start making the withdrawals. There's also no mandatory withdrawal age limit of 70-1/2 years as there has been the 401k, 403b and other IRA retirement plans.<br/><br/>The advantages are immense with a Roth IRA and you can have a staggering amount of savings by the full time you reach 65 years in the event that you make a concerted effort to begin saving from an early age. You do not have to create large after-tax contributions to reap benefits in your retirement. Just small monthly after-tax contributions to Roth IRA will ensure that you have a big tax-free savings to call home your daily life comfortably after retirement.<br/><br/>Usually tax experts advice people to save using a variety of 401k or 403b and Roth IRA. In this way you end up avoiding some taxes in today's as well in your retirement life while ensuring you build a nest egg for your retirement without a lot of ado.