What is a backdoor Roth IRA, and when is it a useful strategy for workers without an employer 401(k)?
A backdoor Roth IRA allows high-income earners to contribute to a Roth IRA by making a nondeductible traditional IRA contribution and converting it, bypassing income limits. It is particularly useful for workers without an employer 401(k) who have no pre-tax IRA balances, avoiding the pro-rata rule.