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I am planning to fund an IRA with $2000 for 2001, which I must do by April 15. I'm trying to decide whether to open a Roth or traditional IRA. My tax advisor just told me that my contribution will not be tax deductible because my AGI is too high, though I do qualify for a Roth. However, due to increases in my AGI over the next several years and the income limitations on a Roth, I will not qualify for a Roth starting in 2003.

My question: Is it worth the added complexity to have a Roth account funded for 2-3 years and then a traditional IRA funded for the next 35 years (i.e., until retirement)? Financially, I think a Roth for the 2-3 years will be slightly better, but logistically I'm not sure that's worth the added complexity in having the different accounts. It is appealing to simply have one large traditional IRA account at retirement, rather than a large traditional account and relatively small Roth account.

What should I do? I would like to hear everyone's thoughts. Thanks!!

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