A financial commentator argues Roth IRAs rest on a dangerous bet: that tax laws won't change. He points to Social Security, once tax-free but now largely taxable, as proof the government shifts the rules. You pay taxes now on contributions, betting you won't owe taxes later. That flexibility is gone.
Everyone loves Roths. I don't. At least not the way most people are using them. Here's the core issue. A Roth is built on one massive mountain sized assumption, and that is the tax rules that you're relying on today will be honored exactly the same way in 20, 30, 40 years from now. That's not conservative planning, that's blind faith. Let me give you another real world example. When Social Security was introduced, people were told, hey, don't worry, you'll never be taxed on this because you've already paid taxes on these dollars through your payroll. Well, fast forward. Today, up to 85% of your Social Security benefits are taxable. Same government, same promise, different outcome. Let's say you put $10,000 into a Roth IRA. You didn't save $10,000. You gave up 3,000 to $4,500 in taxes right now for the hope that the future you might save something that's not free money, that, that's a prepaid tax bill. Another issue here is flexibility. Traditional contributions give you options. Roths lock you into a decision later that you've made decades earlier.
