Kathy would like to save for retirement. She selected a plan through which she can make a limited contribution each year. Her contribution is not tax-deductible, however the investment income accumulates income tax free, and qualified distributions from the plan are not taxed. Kathy is funding a(n):

(a) variable annuity
(b) Roth IRA
(c) traditional IRA
(d) equity-indexed annuity

Ans: (b) Roth IRA