5 Roth IRA Secrets You Need To Know, According to a Top Expert
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Crystal Mayer
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Zuri Anderson
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Recently on the “Erin Talks Money” show, host Erin Moriarity spoke with tax and retirement planning expert Ed Slott. Slott is widely regarded as one of the top experts in the field, having spent his career helping people develop a tax-free retirement plan.
In the episode, “Roth IRA Secrets from America’s Top Tax Expert,” Slott divulges his top tips for retirees. Here are the five Roth IRA secrets you need to know.
IRAs Are a Ticking Time Bomb
According to Slott, IRAs, or Individual Retirement Accounts, are a ticking tax time bomb, and what most people don’t realize is that they are actually a form of debt. With an IRA, individuals pay taxes when they take the money out during retirement. Therefore, the money is subject to the tax rate in effect at the time, which Slott said is likely to increase.
Tax Rates Are Going To Go Up
The Congressional Budget Office, which offers non-partisan analysis for the U.S. Congress, estimates that the recently passed “One, Big Beautiful Bill Act of 2025” will add $3.4 trillion to the national debt over the next decade. One way Congress may offset the costs and tackle the debt is by raising taxes.
Slott suggests an increase in taxes is inevitable. He said people should take advantage of the historic lows by paying taxes now, rather than later. Unlike with traditional IRAs, Roth IRAs are funded by income that has already been taxed. Therefore, they grow tax-free.
Many Employers Offer Roth 401(k) Plans
While many people take advantage of their employer-sponsored retirement plans, few realize that most employers offer a Roth 401(k) option, as well. Fidelity reports that 94% of the companies for which they provide administrative services offer a Roth 401(k) option. However, only 16.2% of the eligible employees contribute to the plan.
When asked, Slott admitted he heavily favors a Roth over traditional retirement plans. Throughout the episode, he reiterated that it is best to pay taxes now, while the rates are still low.
Converting Is Key
Luckily, there are options for individuals who have money tied up in a traditional IRA or 401(k) plan. Many people will be able to convert to a Roth. It is important, however, not to wait too long, as RMDs, or required minimum distributions, cannot be converted. He suggested that older retirees may be able to convert to a Roth to help their beneficiaries, rather than leaving them with a significant tax burden.
Another benefit discussed by Slott was that there are no required minimum distributions with a Roth IRA. According to the AARP, retirees can have better control over their money without having to worry about RMDs or tax implications as funds are withdrawn.
Worth a Second Opinion
While it may not be a well-kept secret, it is essential to consult a financial advisor before making any changes to a retirement plan.
A financial advisor, well-versed in the advantages of a Roth IRA, can help manage risk and provide guidance on which accounts are best suited to specific needs and goals. Slott recommended that even savvy DIY investors consider getting a second opinion from a solid advisor.
With Roth IRAs, there are limitations to who can contribute and how much, making it imperative to seek the advice of a trusted advisor before contributing.
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