Tax-Deferred vs. Tax-Free (Roth):
An Individual Retirement Account (IRA) is a tax advantaged savings accounts that offer investors either the opportunity to defer paying taxes (comes off your yearly income thereby reducing total tax liability) on contributions and any earnings until withdrawn (called a traditional or tax-deferred account), or, pay taxes on contributions now and after five years pay no tax on both initial contributions and all earnings, i.e., tax-free for ever.
Tax-Deferred:
A Traditional IRA is a tax advantaged savings accounts that offers investors the opportunity to defer paying taxes on annual income and accumulated earnings until withdrawn after the age of 59 ½ years.
Tax-Free:
A Roth IRA is a tax advantaged savings account that is funded with after tax contributions, with all initial investments and accumulated earnings withdrawn completely tax free upon retirement (59 ½ years) or, in some instances, after 5 years.
Generally speaking, contributing to a Roth IRA is more advantageous if you expect to be in a higher income tax bracket when you retire. ________________________________ 
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