ROTH IRAs are yet-another-type of “retirement accounts”.
The benefit of a ROTH IRA is, when you eventually withdraw money out of it, you won’t be taxed on that money. Taxes are always going up every year. This is a huge benefit.
The two downsides to me are: you can’t put much in every year and you can’t use pre-tax deposit benefits. Which means, you have to pay taxes like you normally do and then use some of the money that’s left over.
The max amount you can do for the year is $6,500 for 2023 as a single person, compared to a regular 401k which is $22,500 for 2023. Big difference in deposits.
My personal opinion (not investing advice) is ROTH IRA’s are good to fill up after maxing out a regular 401k or IRA for the year. This way the full amount of those deposits can reduce the taxable income for the year and put away more money away for retirement.
Since ROTH IRAs have such a low contribution amount, they’re usually last on my list to touch for the year.
There is a way to contribute larger amounts to your ROTH IRA, you can find that article I wrote here