Roth IRA vs Traditional Savings Account

First,

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I am certainly not an investing guru nor am I extremely savvy when it comes to stocks, bonds, mutual funds, etc... (yet)

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Second, the reason I have money in a "savings" account if you will, is solely for emergencies. I can literally make a couple of clicks from a computer or phone, and have money from my "savings" into my checking if shite was to hit the fan or I needed it. Pretty sure you could not do that from a Roth.

Aside from my "savings" account, which is an emergency fund, all of my other savings are tied up in investments.

A traditional savings account would be a general low yield account held by a bank on which you paid taxes on the cash and are free to draw the money on as needed.

A traditional IRA functions in that you don't pay federal income taxes on the money (state have their own laws for their own income taxes) you contribute to it. So if you put $4K in a traditional IRA, you'd deduct it on your income tax forms. So when you deduct the $4,000 on your income tax form, your income decreases by $4,000 and if you're in the 25% income tax bracket, your tax liability (or refund) would be $1,000 higher ($4,000 times 25%). Then the money in the traditional IRA would grow tax free until you withdraw it from the account.

If you open a traditional IRA, you can't pull the money out until you reach retirement age (and then would be subject to income taxes). If you pull it out prior to retirement age you have to pay income taxes to the government as well as a 10% penalty to the government (there are a handful of exceptions where you just pay income taxes on it an no penalty). There are also income limitations where you're phased out (or limited)in the amount you can contribute up to a certain income and then if you're income is over a certain amount, the government won't let you contribute to a traditional IRA. Bonuses or capital gains in addition to your salary could put you into the phase out range or keep you from contributing to it at all. I unknowingly contributed over my phase out limit (I didn't know about that rule when I filed my taxes) and got hit with an IRS tax bill 2years later.

In a Roth IRA, you pay federal taxes on what you contribute today. The money grows tax free until you withdraw it and it is then not subject to income taxes. I believe if you keep the money in the IRA for 5 years, you are able to withdraw the principal (contributions and not earnings on contributions) without penalty or paying income tax. It does have phase out limits as well, but the income thresholds to hit those phase out limits are much higher on a Roth IRA than a traditional IRA. I believe Roth IRAs can be inherited and as long as the money grows in it, it is tax free to the heir(s) and their distributions from it upon liquidation would be tax free as well.