Traditional IRA vs. Roth IRA: Which Is the Right Choice for You?

By Stefon Walters – Mar 15, 2026 at 5:47AM ESTKey PointsContributions to an IRA are not taken directly from your paycheck as with a 401(k).The maximum amount you can contribute to an IRA in 2026 is $7,500, or $8,600 if you're 50 or older.Deciding which IRA is best for you comes down to when you want to pay taxes.Saving for retirement shouldn't be an afterthought; it's a necessity. And one of the best ways to do so efficiently is to take advantage of retirement accounts, which offer tax breaks. While a 401(k) is the most common retirement account, it's not the only one. Individual retirement accounts (IRAs) are another great option and offer benefits that you don't receive with a 401(k). There are two types of IRAs: traditional and Roth. While you can contribute to both, it's generally better to focus on one. But which one is the right choice for you? Well, that depends. Image source: Getty Images. The difference between a traditional IRA and a Roth IRA The main difference between a traditional IRA and a Roth IRA is the "type" of money you contribute to them. Contributions to a traditional IRA are often tax-deductible, with some exceptions based on income limits and retirement-plan coverage at work. This reduces your taxable income for the year you make the contributions, but you'll owe taxes on the withdrawals you make in retirement (as with a 401(k)). You can't deduct your contributions to a Roth IRA, but your withdrawals are tax-free in retirement. This unique benefit can easily save you thousands in taxes. In 2026, the maximum total amount you can contribute to one or more IRAs is $7,500, or $8,600 if you're 50 or older. Not everyone is eligible to contribute to a Roth IRA An important note about Roth IRAs is the income limit for contribution eligibility. If you're single, you can't contribute to a Roth IRA if your income is above $168,000. If your income is between $153,000 and $168,000, you can contribute something, but not the full $7,500 or $8,600. Earning less than $153,000 means you can contribute the full amount. If you're married and filing jointly, the phaseout range is $242,000 to $252,000. Below that, you can contribute the full amount; above that, you can't contribute any. Which account type is better for you? Deciding between a traditional IRA and a Roth IRA generally comes down to when you want to pay taxes. If you're likely in your highest-earning years, going with a traditional IRA makes sense because you get the upfront tax break (assuming you qualify) and then pay taxes in retirement, when you're likely to be in a lower tax bracket. If you're likely to be in a higher tax bracket in retirement, going with a Roth IRA makes sense because you pay taxes upfront in the lower tax bracket and then have tax-free withdrawals in retirement.Read NextMar 16, 2026 •By Christy BieberThe Clock Is Ticking on Claiming the New Senior Tax DeductionMar 16, 2026 •By Kailey Hagen, CFPThis Popular 2027 Social Security COLA Projection Has Increased, But Seniors Still Aren't HappyMar 16, 2026 •By Kailey Hagen, CFPNearly All Retirees Who Did This Report Retiring ComfortablyMar 16, 2026 •By Maurie BackmanWaited Until Your 40s to Save for Retirement? Here's Your Game Plan.Mar 16, 2026 •By Christy BieberMedicare Is Making a Major Change to Expand Coverage as Early as AprilMar 16, 2026 •By Kailey Hagen, CFPThe New Senior Tax Deduction Has an Unintended Consequence for Social SecurityAbout the AuthorStefon Walters is a contributing Motley Fool stock market analyst covering publicly traded companies across technology, consumer goods, and financials, as well as retirement planning. Stefon is a published author and has more than a decade of experience teaching financial literacy. He holds a bachelor’s degree in economics from the University of North Carolina at Chapel Hill.TMFStefonW