It's important to save and invest for retirement so you don't end up struggling financially during your senior years. Social Security won't provide you with enough income to live on comfortably, so you should plan to supplement those benefits with distributions from your own portfolio.

Now, when it comes to finding homes for your retirement investments, you have choices. If one is available to you, you could fund a 401(k) plan through your employer. Another popular option is to open an individual retirement account (IRA) that you can manage yourself.

Many IRA users prefer to invest via Roth IRAs because of the specific benefits those accounts offer, from tax-free investment gains to tax-free withdrawals in retirement. Also, Roth IRAs have long been the only tax-advantaged retirement accounts to not impose required minimum distributions (although starting in 2024, Roth 401(k)s will no longer require them).

A person at a laptop holding a pen.

Image source: Getty Images.

But if you're going to keep some of your long-term investments in a Roth IRA, it's essential that you manage that account wisely. And that means avoiding these big mistakes.

1. Taking early withdrawals because you can

One way in which a Roth IRA differs from a traditional IRA or 401(k) is that you don't get a tax break on the money you put in it when you make those contributions. Because of this, you can take early withdrawals from a Roth IRA without penalty as long as those withdrawals are no larger than the principal you've put into the account and you're not tapping your investment gains.

But it's that very flexibility that might lead you to take withdrawals without thinking it through. Every dollar you remove from your Roth IRA ahead of retirement is money you won't have during your senior years, when your Social Security benefits might start to fall short. So even though you may be tempted to tap your Roth IRA to pay for things like home repairs because you can, don't do it.

2. Having it double as a college fund

Some people use Roth IRAs as a vehicle to save for their children's college costs. It's one thing to open a Roth IRA for that express purpose. It's another thing to try and have a Roth IRA pull double duty as both a retirement fund and a college fund. If you go this route, you might end up dangerously short on retirement funds because you took too much money out along the way to pay for your kids' education.

3. Forgetting to take advantage of catch-up contributions

Once you turn 50, you have the option of making catch-up contributions of an extra $1,000 per year to your Roth IRA beyond what younger savers are allowed to contribute. That's an opportunity you don't want to pass up. You may be used to maxing out a Roth IRA at a lower limit, but putting in an extra $1,000 a year for what could easily be a good 15 or 20 years could give a healthy boost to your retirement finances.

You might enjoy a lot of success in the course of saving for retirement if you choose to invest through a Roth IRA. But make sure you manage that money well so there's plenty of it to go around once your time in the workforce comes to an end.