Suze Orman Loves Roth IRAs. Here's Why You Should, Too

They're a really great savings option to consider.

Many seniors learn the hard way that Social Security benefits aren't enough to make for a comfortable retirement. If you want to maintain a decent standard of living, you'll need savings of your own to tap during retirement. And in that regard, you have choices when it comes to building up a nest egg.

If your employer offers a 401(k) plan, you could save for retirement there. And it pays to do so if your company also offers a matching contribution.

But if you're self-employed or you don't have access to a 401(k) plan through work, then it pays to look at an IRA. As long as you have earned income, you have the option to fund an IRA. And you can also choose between a traditional IRA and a Roth IRA.

Now the benefit of funding a traditional IRA is clear -- you get an immediate tax break on the money you put in. So if, for example, you stick $3,000 into your IRA this year, that's $3,000 the IRS won't tax you on.

Roth IRAs don't offer an immediate tax break like traditional IRAs do. But in spite of that, financial guru Suze Orman is a huge fan of Roth IRAs. And here's why you may want to consider housing your retirement savings in one of these accounts.

1. You'll get tax-free withdrawals in retirement

Taxes can be a major burden at any stage of life. But by the time you get to retirement, you may not want to deal with them.

If you keep your savings in a Roth IRA, you'll get to enjoy tax-free withdrawals. This doesn't mean you won't owe the IRS any tax during the year, as you might have other income sources that are subject to taxes. But you'll at least have one income stream where taxes won't apply, and that could spare you a lot of financial stress as a senior.

2. You won't have to take required minimum distributions

Most tax-advantaged retirement savings plans impose required minimum distributions, or RMDs. The reason? The IRS doesn't want savers to keep enjoying tax-advantaged growth in their retirement plans indefinitely and use their savings as a means of passing wealth down to younger generations. RMDs effectively force you to spend down your savings in your lifetime.

But Roth IRAs are the only tax-advantaged savings choice where RMDs don't apply. That gives you more flexibility with your money. And if your goal is to leave some of your savings behind to your children or grandchildren, a Roth IRA could make that possible.

3. You get more flexibility with your money

The purpose of funding a retirement plan is to have money on hand for your senior years. As such, it's generally best to leave your retirement savings alone and not take withdrawals early.

Now with a traditional IRA or 401(k), you'll face a 10% early withdrawal penalty if you remove funds from your account before turning 59 ½. But since Roth IRAs are funded with after-tax dollars, not pre-tax dollars, you can withdraw your principal contributions early without automatically incurring a penalty. That gives you the option to use your Roth IRA as an emergency fund of sorts.

Again, to be clear, you shouldn't count on taking early IRA withdrawals, and ideally you should save separately in a savings account for emergencies. But if you wind up in an unexpected situation, your Roth IRA could bail you out without you incurring penalties.

There's a reason Suze Orman often encourages savers to look to a Roth IRA -- it's because of the benefits above. And so if you're not sure where to keep your nest egg, it pays to think strongly about choosing a Roth IRA.