Craig Wear, CFP®Craig Wear, CFP® | Expert in Roth Conversions & Tax-Efficient Retirement Strategies for IRA Millionaires

The biggest mistake people make with IRAs is thinking they are all the same. They are not.

23 Aug 2025 · 1 min

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1:05

YouTube video excerpt in which Craig Wear, CFP® explains the difference between Roth and traditional IRAs, tax timing (pay now vs. pay later), contribution limits for 2025, eligibility threshold for direct Roth contributions for single filers, and recommends Roths for new savers and conversions for those with large pre-tax balances.

Questions this video answers

$161,000 (in 2025)

$7,000 if under 50; $8,000 if 50 or older

Chapters

Which IRA should you choose? Everyone talks about opening an ira, but the big question is, should you go Roth or traditional? So with a Roth ira, you're going to pay taxes on your money now, but it grows and comes out 100% tax free in retirement or just later in life. With the traditional ira, you skip the taxes now, but you pay later when you withdraw. So if you're a single filer making $161,000 in 2025, you can contribute directly to a Roth IRA. If you're over that, you're going to have to go with the traditional or use maybe a backdoor Roth strategy. The contribution limits are the same, 7,000 if you're under 50 and 8,000 if you're over 50. If you're just starting out saving, definitely go with the Roth. If you've already accumulated large pre tax savings, I'd really suggest that you look at limiting your contributions and begin using some of that money for conversions. You're going to want a coordinated strategy to maximize your future net worth and minimize your future taxes. And you can do that through conversions. But whatever you do, don't wait. If you, if you have large pre tax savings, it's definitely in your best interest to get that plan for converting your accounts and get it now.