“America’s IRA expert,” Ed Slott, recently told other industry experts that “an IRA is just an IOU to the IRS.” Slott says he doesn’t see any benefit to using a traditional IRA right now because tax rates are so low. However, Peter with Richon Planning does not agree with Slott and explains why to Erin Kennedy.
There are many reasons investors should still consider investing in tax-deferred accounts, even though we are living in a historically low tax rate. There is no cookie cutter answer. No blanket statement can apply to every person; there are too many variables to consider. For example, what’s your current tax rate, what will your future tax rate be? You may very well be in a lower tax bracket when you retire, so taking a deduction today, does make sense.
