What is a Tax-Free Retirement Account or TRA?
In the Video above, Scott Farnsworth, Central Florida's Tax-Free Retirement Expert answers a frequently asked question: What is a Tax-Free Retirement Account or TRA?
"A tax-free retirement account or TRA is a great vehicle for allowing you to put away money that grows tax-free and then is distributed at retirement tax-free. There are a few trade-offs. You do not get a tax deduction today for the money you put in, or said differently, you use after-tax dollars to fund a TRA, but because it grows on a tax-free basis and it comes out of the TRA with no tax and in fact with no reporting to the IRS, it's a fantastic tool.
It has far fewer limitations than the Roth IRA and the other conventional retirement tools. There's no restriction on not taking the money out before 59-1/2. There's no obligation to make mandatory distributions after 70-1/2. The cost are much lower than the other tools as well, so many of my clients use the TRA as a key link in their program of having a tax-free retirement."