You may have a benefit at work that you are unaware of. Or if you were aware of it, perhaps you aren’t sure what to do about it. An employer sponsored Roth retirement savings account is a valuable benefit that many employees don’t take advantage of.

About half of employers offering a retirement savings plan offer both a traditional plan and a Roth plan according to a study by Aon Hewitt.

In a traditional plan, your contributions are taken from your pay before taxes and excluded from your taxable income. For example, if you are single with a $45,000 income, your federal taxes for the year would be $7,028. If you made a 6.0 percent contribution to your retirement savings plan, your federal taxes would only be $6,353, saving you $675 in taxes for the year, and allowing you to save $2,700 while your pay is only reduced by $2,025. If your employer matches your contribution, and most do, their contribution and the investment earnings are also tax free until you reach retirement.

When you start withdrawing the money from your savings plan in retirement, your entire withdrawal will be taxed as income. If you have other sources of income at that time, and you don’t need to draw on your retirement savings account, you will still need to make a required minimum withdrawal from the account every year after you are 70½, so the government can start getting some tax revenue on that money.

A Roth account is different. If you contribute to a Roth retirement savings account, your contributions are made after taxes are taken from your pay. You won’t get the current tax benefit of $675 in our example. However, your withdrawals in retirement are completely tax free.

This is a big benefit when you begin living on your savings. If you don’t have to pay taxes on your withdrawals, your savings will go farther. In addition, if you don’t need the money, you are not required to take a minimum distribution, so your savings can continue to grow tax free.

Finally, withdrawals from your Roth account won’t count as income in determining whether your social security benefits are taxable as long as the withdrawal is “qualified“. In other words it takes place after you turn 59½ and the withdrawal is made at least five years after the contribution.

In an employer sponsored Roth retirement savings plan there is no income limit. Anyone can contribute. This is a big difference from a Roth IRA outside of work. With a Roth IRA, only those with annual incomes lower than $118,000 for singles and $186,000 for married couples can contribute up to the full IRA contribution limit ($5,500).

The contribution limits in a Roth savings plan are the same as those for a traditional plan ($18,000 for 2017). If you take advantage of the Roth option in your plan, your employer’s contribution will still be made in the traditional plan, so you will wind up with some savings in a Roth account and some savings in a traditional account.

If you have been saving through a traditional retirement savings plan at work, you can still make future contributions to a Roth account. Whether it’s worthwhile to convert your traditional savings to a Roth is a trickier question and one worth getting some specific tax advice on. When you convert your traditional retirement savings to a Roth account, the amount you convert will become taxable income in the year you make the change. That can put a big dent in your savings. Not all employer plans allow a conversion, so you will also want to check with your benefits administrator.

We can’t predict what our taxes will be when we retire, but if we have done our job right and saved enough to support ourselves, it’s a good bet we’ll be paying them. Having some savings that can be withdrawn without paying taxes will be an advantage. Check whether your employer offers a Roth version or your retirement savings plan, and if they do, consider making the change.

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