vest ment ▁g ains ▁only ▁affect ▁the ▁individual ' s ▁top ▁tax ▁bra cket , ▁the ▁results ▁are ▁tax - neut ral . ▁Any ▁potential ▁benefits ▁of ▁claim ing ▁and ▁rein vest ing ▁a ▁tax ▁dedu ction ▁come ▁from ▁the ▁expectation ▁that ▁the ▁tax p ayer ▁may ▁be ▁in ▁a ▁lower ▁tax ▁bra cket ▁during ▁ret irement . ▁ ▁The ▁only ▁benefit ▁that ▁everyone ▁receives ▁is ▁the ▁income ' s ▁protection ▁from ▁tax . ▁This ▁equals ▁the ▁dollars ▁of ▁tax ▁that ▁would ▁have ▁been ▁paid ▁on ▁the ▁income ▁if ▁earned ▁in ▁a ▁tax able ▁account . ▁It ▁exactly ▁equals ▁the ▁benefit ▁of ▁a ▁Roth ▁I RA . ▁ ▁Un like ▁a ▁Roth ▁I RA , ▁there ▁is ▁another ▁possible ▁benefit ▁( or ▁penalty ) ▁equal ▁to ▁the ▁reduction ▁( or ▁increase ) ▁in ▁tax ▁rates ▁between ▁the ▁contribution ▁and ▁withdraw al , ▁multip lied ▁by ▁the ▁dollars ▁with dra wn . ▁Many ▁tax pay ers ▁expect ▁to ▁be ▁in ▁a ▁lower ▁tax ▁bra cket ▁in ▁ret irement . ▁While ▁the ▁tax ▁benefits ▁from ▁contributions ▁are ▁considered ▁to ▁be ▁at ▁the ▁contrib utor ' s ▁marg inal ▁tax ▁rate , ▁the ▁withdraw als ▁may ▁add ▁income ▁at ▁lower ▁progress ive ▁tax ▁brackets . ▁ ▁An ▁I RA ▁protect s ▁wealth ▁from ▁credit ors , ▁but ▁also ▁cannot ▁be ▁used ▁as ▁coll ater al ▁when ▁borrow ing . ▁ ▁With ▁a ▁Trad itional ▁I RA , ▁one ▁always ▁has ▁an ▁option ▁to ▁convert ▁to ▁a ▁Roth ▁I RA ; ▁whereas ▁a ▁Roth ▁I RA ▁cannot