So I'm trying to plan out 2015, and based on my annual cash flow spreadsheet, after I pay off all our consumer debt, I will most likely be able to max out my first IRA (I'm still in college).
My question is, if I have enough deductions and a low enough income to actually owe $0 in tax before considering retirement account deductions and credits, is there any other benefit to doing a Traditional IRA? I understand the Roth conversion ladder, I just don't think it would be necessary since technically all of my income isn't taxed? I don't think the Retirement Savings credit is refundable, and even if it is, I get the education credits/deductions so I don't think I'm eligible for it. Based on what I've read, it seems like the Roth would be essentially the same as a Traditional in this case, except I wouldn't have to deal with the conversion ladder later on. Am I understanding this correctly?
Secondly, I would be doing this before paying off some student loans that are at 6.8%. My logic on this is that the loans are still under in school deferment, so even the ones that are currently earning interest haven't had the interest capitalize. I'm going to be in school for the next 5 years (professional/graduate school), so it's not like they're going to capitalize this May. Based on my spreadsheets, I should be able to pay off at least the higher interest loans, if not all my loans, before I finish my terminal degree, even if I max out an IRA every year. So I thought that it would make the most sense to start investing now while I'm young (23), to give it as much time to grow as possible. Is this logical, or should I just be throwing everything at the student loans?
Thanks! :)