Income in the current year and save it for retirement

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Reference no: EM13941187

A consumer has decided to set aside $2000 out of her income in the current year and save it for retirement. She has the choice of putting all $2000 in a traditional IRA or else putting all $2000 in a Roth IRA. What factors should determine her choice? Be as specific as possible. To simplify the problem, you may assume that she knows her marginal income tax rate and knows the marginal income tax rate she will have to pay in the first year of her retirement when she will withdraw the $2000 IRA deposit and the full return on it.

Reference no: EM13941187

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