d,
It is my understanding that you can 'roll' money from an IRA into a ROTH by paying the required taxes, ie - the ROTH is funded with after tax monies. Other than that, I think that you can establish a ROTH with a contribution of 2K per year, but it is restricted as your income increase, and eventually you are not able to get the ROTH. It was designed for the lower income earners.
As for longevity, I don't think that the ROTH accounts will be around for a long time, but used to transition people away from Social Security. I think that those who get the ROTH will be 'grandfathered' into the plan, but further contributions may be curtailed due to the tax-free status. FWIW, I think that the ability to fund the ROTH this year, paying the taxes on those funds over the next 4 years is the best option. Next year, if you roll a bunch of money, all of the taxes have to be paid that year. I really don't think that there will be enough investors in the ROTH for the government to change the tax structure. I think that the GATT agreement will change the whole concept by 2000. So there is really only a 2 year period. Remember that if you invest in a ROTH, you CAN ONLY take OUT YOUR contribution, not the profits for the first 5 years, and then I think you are limited as to what you can spend it on. (house, education)
Regards,
Ken |
