The Roth IRA was created in 1997 and is named after Senator William Roth. The Roth IRA is a versatile retirement plan that confers multiple benefits. The contributions made are with after-tax money and are not tax-deductible, this enables earnings on the account to accumulate tax-free. Distributions from the account are also tax free provided certain criteria is satisfied. This vehicle is tax efficient because you only must pay tax on the initial investment rather than the accumulated growth value over time. This is especially important if your tax rate increased in the future. Another benefit is that there are no age limits for contributions and no required minimum distributions. On the other hand, one major drawback to a Roth IRA is that high-income earners cannot open or contribute to a Roth IRA directly. If you file taxes as a single person the income limit is $140,000, and if you are married and file jointly the income limit is $208,000*. The good news is that they still have options. Speak with your tax advisor on how this will increase your taxes for the year.