3 Reasons Not Having a Roth IRA in Retirement Could Cost You

By Maurie Backman – Mar 30, 2026 at 1:36PM ESTKey PointsAlthough you don't get a tax break on Roth IRA contributions, these accounts are worth having.They could give you more control over your money in retirement.They could also help you avoid other surprise expenses.Choosing the right home for your retirement nest egg is important. And if you don't have an employer plan, you can open an IRA on your own. IRAs come in two main varieties -- traditional and Roth. And funding a traditional IRA may be tempting because you get a tax break on your contributions. With a Roth IRA, there's no immediate benefit. Image source: Getty Images. But if you pass up the opportunity to fund a Roth IRA, you might regret it later. Here's why not having a Roth IRA in retirement could cost you big time. 1. You lose out on flexibility While Roth IRAs don't give you a tax break on contributions, withdrawals are tax-free. That's not the case with traditional IRA withdrawals, which force you to share that money with the IRS. Not only that, but traditional IRAs force you to take required minimum distributions (RMDs) at a certain point. With a Roth IRA, you get more control over your money. There are no RMDs, so you can leave your balance alone as long as that works for you. 2. You risk taxes on Social Security You may not realize this, but up to 85% of your Social Security benefits may be subject to taxes, depending on your total income picture. Traditional retirement plan withdrawals count as income when determining whether your Social Security checks are taxable. Roth IRA withdrawals do not. Here's what that means. Let's say you withdraw $60,000 a year from your retirement savings. With a traditional IRA, that amount alone could push you into the territory of having your Social Security taxed. If you take $60,000 a year from a Roth IRA and your only other income stream is Social Security, you may get to keep those benefits tax-free. 3. You might have to pay more for Medicare Although there's a standard cost for Medicare Part B, higher earners can be assessed surcharges called income-related monthly adjustment amounts, or IRMAAs. IRMAAs apply to Part B as well as Part D drug plans. And they can potentially add hundreds of dollars a month to the cost of Medicare premiums. With a traditional IRA, withdrawals count in the calculation used to determine whether IRMAAs apply. Roth IRA withdrawals do not. Having a Roth IRA could therefore be your ticket to paying less for Medicare. A Roth IRA offers unique benefits that are hard to find elsewhere. Even though you won't get an immediate tax break on the money you put into a Roth IRA, the perks of having one of these accounts can well outweigh that one drawback. So it's worth saving for retirement in a Roth IRA, especially since you might sorely regret not doing so down the line.Read NextMar 31, 2026 •By Selena Maranjian11 Retirement Rules That No Longer Apply in 2026 and BeyondMar 31, 2026 •By Maurie BackmanWhat the $24,480 Social Security Earnings Limit Means If You Retire This YearMar 30, 2026 •By Kailey Hagen, CFPThe Math-Free Way to Estimate Your Future Social Security BenefitMar 30, 2026 •By Maurie BackmanHere's How Much You Should Have Saved in Your 401(k) by 55Mar 30, 2026 •By Kailey Hagen, CFPYou Aren't Getting the Most Out of Social Security Unless You Do These 3 ThingsMar 30, 2026 •By Kailey Hagen, CFPDon't Want RMDs Inflating Your Tax Bill? 3 Things You Can Try.About the AuthorMaurie Backman is a contributing Motley Fool retirement and Social Security expert with more than a decade of experience writing about personal finance, investing, and retirement planning. Maurie previously worked in finance analyzing distressed companies. She studied finance at Binghamton University.TMFBookNerd