Roth IRA Vs. Traditional IRA Decisions – Should I Contribute To My Roth IRA Vs. My Traditional IRA? (2026)

2026 · SHOULD I CONTRIBUTE TO MY ROTH IRA VS. MY TRADITIONAL IRA?
If you can only make a non-deductible traditional IRA contribution, consider making a Backdoor Roth IRA contribution.Reference the “Can I Make A Backdoor Roth IRA Contribution?” flowchart to see if you are eligible.Do you expect your future marginal tax rates to be higher than your current rates?Do you want to maximize the contribution amount and can you afford to make the full annual contribution of $7,500 ($8,600 if age 50 or over)?Consider making a contribution to yourRoth IRA.The dollars you contribute will be taxable now, at the lower rates. In the future, eligible distributions will be tax-free when you are presumably in a higher tax bracket.The dollars you contribute will be deductible now, at the higher rates. In the future, eligible distributions will be taxed when you are presumably in a lower tax bracket.Consider making a contribution to your Roth IRA, which is not subject to RMDs.Consider making an after-tax contribution to your Roth IRA. The tax is paid with outside dollars on top of the contribution amount.Consider making a contribution to your traditional IRA.Will you need retirement income from your IRAs?If you have any low-income years, you could consider doing a partial Roth conversion to fill up the lower brackets.Consider making a partial contribution to your traditional IRA so you can receive a tax deduction now. Be mindful, you will have to pay taxes in the future upon distribution.NoYesNoYesNoYesNoYesAre you eligible to deduct your traditional IRA contribution?NoYesAre you eligible to contribute to a Roth IRA and a traditional IRA?START HERE
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 Dejan Ilijevski, MBA, MS

SCM Investment Services | Lake Elmo, MN | (612) 324-0629

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