Public.com offers two types of retirement accounts: a Roth IRA and a Traditional IRA. To understand which account makes the most sense for you, review the information below, review the differences here, explore the IRS website, and consult with a tax professional.

The Roth IRA

With a Roth IRA, you contribute money that you’ve already paid taxes on (post-tax). The main advantage of a Roth IRA is that your investments grow tax-free, and when you make eligible withdrawals of your earnings in retirement, you won’t owe any taxes on those withdrawals. Roth IRA contributions may be limited or unavailable for investors that exceed the income limitations set by the IRS found here. Keep in mind that withdrawing funds before the account is over 5 years old and before you are age 59 ½ may lead to penalties, so it’s essential to plan your contributions with long-term goals in mind.

This information is for educational purposes only and is not tax or investment advice. Consult your tax advisor for individual considerations. All investing involves risk. Visit the IRS website for more information.

The Traditional IRA

With a Traditional IRA, your contributions can be made with pre-tax dollars if certain requirements are met. Earnings in a Traditional IRA are tax-deferred as long as they remain in the account and subject to ordinary income tax when withdrawn.

Like the Roth IRA, withdrawing before age 59 ½ may result in additional taxes and penalties, so it’s important to align your contributions with your retirement timeline. Visit the IRS website to learn more.

For further questions please contact the Member Support team via in-app chat or email at support@public.com.

This information is for educational purposes only and is not tax or investment advice. Consult your tax advisor for individual considerations. All investing involves risk. Visit the IRS website for more information.