Roth IRA should be the retirement fund vehicle of choice (after company matching in 401(k)-like plans). Unfortunately, even with this round of increase in income limit, my family is still priced out of the market.

The Roth IRA income limits will increase moderately in 2007, but the contribution amount remains the same. You'll be able to contribute the full $4,000 per year to a Roth only if your adjusted gross income is less than $99,000 if single or $156,000 if married filing jointly (you can contribute up to $5,000 if you are 50 or older). You'll be able to contribute part of that amount if you're single and earning less than $114,000, or $166,000 if married filing jointly, and the amount phases out entirely above that level.

Your adjusted gross income still must be below $100,000 to convert a traditional IRA into a Roth, but those rules will change in 2010. At that point, the $100,000 income limit disappears, and anyone will be able to convert traditional IRA money to a Roth. You'll still have to pay taxes on the whole conversion if you had only made tax-deductible contributions to the traditional IRA, or on the earnings for non-deductible contributions, but any gains after you move the money to a Roth will be tax-free in retirement.