What Is A Roth IRA? | Tax-Free Income In Retirement | T. Rowe Price

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100% of our Retirement Funds beat their 10-year Lipper average as of 9/30/16.*


Roth IRA

A flexible way to save that provides tax-free income in retirement.* If you earn under $131k in 2015 or $132k in 2016 per year, or $193k in 2015 or $194k in 2016 jointly**, a Roth IRA might be right for you.

The time is now

The sooner you start contributing to a Roth IRA** the better. The longer your contributions have to compound tax-deferred, the more your contributions may be worth in retirement.

Flexibility for life's unexpected events

Your contributions are available for withdrawal anytime without tax or penalty.*

Pay no taxes in retirement

Once you reach age 59½ with an account that has been opened for at least five years, you may qualify for tax-free withdrawals of both Roth IRA contributions and any accumulated earnings.

Enjoy more spendable income in retirement

Most people will realize more spendable income in retirement. Plus, there are no minimum distribution requirements.

Receive active management with a single choice

Pair your Roth IRA with our professionally managed target date funds for a convenient way to get a diversified portfolio. We also offer over 100 no-load mutual funds to address your specific investing needs. All mutual funds are subject to market risk, including possible loss of principal. Diversification cannot assure a profit or protect against loss in a declining market.

Low fees and minimum investment

Minimum investment for a Roth IRA is $1,000. Certain account fees are waived if you select our paperless options.

* As long as you've held the account at least 5 years and you're age 59½ or older.

**In order to contribute to a Roth IRA, single filers must have a MAGI under $131k for tax year 2015 and $132k for tax year 2016. Married couples filing jointly must have a MAGI under $193k for tax year 2015 and $194k for tax year 2016.


Which IRA is right for you?

Compare Roth vs. Traditional IRAs, or
Complete the IRA Selection Tool to help you choose the IRA that meets your lifestyle and investing needs.


Are you moving money from another source?

Roll over a 401(k)

A Rollover IRA is one of several options to consider for your former workplace retirement plan, such as a 401(k).


Convert your T. Rowe Price Traditional IRA to a Roth IRA

A Roth IRA offers many advantages over a Traditional IRA, like potentially tax-free withdrawals if you need them. Click here to convert your existing Traditional IRA now, or read more.


Transfer an existing IRA

To simplify your finances, you can consolidate assets by transferring an existing IRA account to T. Rowe Price.

The principal value of the Retirement Funds and Target Funds (collectively the "target date funds") is not guaranteed at any time, including at or after the target date, which is the approximate year an investor plans to retire (assumed to be age 65) and likely stop making new investments in the fund. If an investor plans to retire significantly earlier or later than age 65, the funds may not be an appropriate investment even if the investor is retiring on or near the target date. The target date funds' allocations among a broad range of underlying T. Rowe Price stock and bond funds will change over time. The Retirement Funds emphasize potential capital appreciation during the early phases of retirement asset accumulation, balance the need for appreciation with the need for income as retirement approaches, and focus on supporting an income stream over a long-term retirement withdrawal horizon. The Target Funds emphasize asset accumulation prior to retirement, balance the need for reduced market risk and income as retirement approaches, and focus on supporting an income stream over a moderate postretirement withdrawal horizon. The target date funds are not designed for a lump sum redemption at the target date and do not guarantee a particular level of income. The key difference between the Retirement Funds and the Target Funds is the overall allocation to equity; although they each maintain significant allocations to equities both prior to and after the target date, the Retirement Funds maintain a higher equity allocation, which can result in greater volatility over shorter time horizons.

*20 of our 36 Retirement Funds had a 10-year track record as of 9/30/16. (Includes all share classes.) All 20 of these 20 funds (100%) beat their Lipper averages for the 10-year period. 36 of 36, 36 of 36, and 36 of 36 of the Retirement Funds outperformed their Lipper average for the 1-, 3-, 5-year periods ended 9/30/16, respectively. Calculations are based on cumulative total return. Not all funds outperformed for all periods. (Source for data: Lipper Inc.)