12
practice testMultiple Choice

Practice Test

Question 12 • Personal Finance

Part B: What is a benefit of Roth IRAs?

Answer
A
taxes paid later
B
contributions are pre-tax
C
withdrawals may be tax-free
D
no growth

Explanation

A Roth IRA is funded with contributions made after taxes have been paid. If the account holder meets the rules for a qualified withdrawal, the money taken out—including investment growth—may be tax-free, so “withdrawals may be tax-free” is the benefit.

AI-written and checked against the verified answer.

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