Is there something like the American IRA (individual retirement account) in Italy?

Traditional IRA versus ROTH IRA?

• My fiance has moved to a new job. The previous job set up a retirement account for her. The account dropped below $1000 (to $990) so Fidelity told her she needed to do something with the account. I believe the employer requires the $1000 minimum. She has a few options, take the cash (minus the taxes and penalties), create a traditional IRA, or create a ROTH IRA. We want to keep the money invested. We know the difference between a Roth and a traditional. We just dont know which would be better. I am a teacher and will have a pension. I also plan on having other investments (I havent started yet- I am 23 and just started teaching). A teacher I work with suggested taking the cash and then investing it in my name in a TSA when we get married. I dont like that because of how much she would lose to get the cash. I would think the ROTH is the best option, but dont really know. Any suggestions?

• Answer:

  A Roth will be better in the long run. But you can't roll the money directly into a Roth...it has to go from a 401(k) into a Traditional IRA then you can convert it to a Roth. You'll have to pay taxes but no penalties. And then she'll have a Roth to contribute to in the future. Remember...there are income restrictions for contributing to a Roth. I don't think you guys are there yet...but keep them in mind. Best of luck!