You contribute your after tax earnings to a Roth IRA account but earnings and withdrawals from it after meeting certain requirements is tax free. Roth IRAs carry certain advantages over Traditional IRAs. This makes Roth IRAs more appealing to many especially to elderly.

In addition to tax free compounded growth, Roth IRAs are not subject to required minimum distributions (RMD) which allows it to grow for longer period of time than a Traditional IRA. Traditional IRA distribution is required at you reaching 70 ½ years of age. This is why it makes more appealing to put Roth IRA funds into growth stocks and similar growing instruments.

When converting traditional IRAs to a Roth IRA, consider contribution limits and do it methodically. For 2013 and 2014, contribution limit for a ROTH IRA for those who are 50 years of age and over is $6,500. Your annual income may bring additional limitations. Married couples with combined income over $188,000 and single over $127,000 for 2013, contributions to a Roth IRA will be phased out. These limits for 2014 are $191,000 and $129,000 respectively. If you have no earnings, take a look at converting your existing Traditional IRA gradually into a Roth IRA.