A Roth Individual Retirement Account is a retirement savings account that allows your money to grow tax-free.
You fund a Roth with after-tax dollars. Translation: you have already paid taxes on the money you put into it. In return for having no up-front tax break, your money grows tax free, and when you withdraw at retirement, you pay no taxes.
Certified financial planner Diahann Lassus, president and chief investment officer of Lassus Wherley, explains.