Money for retirement is of course the money for retirement. But the nondeductible IRA contributions can still be valuable. Because your investments will no matter what grow tax-deferred.
However you yourself are responsible for keeping track of after-tax contributions and this can happen through filing the IRS Form 8606 every single year. which can sort of be a pain in the ass. But if you are filling the form every single year then you’re not taxed again on that money when you take retirement distributions
However there are much better options you should focus on before you go to up the hill which is named “nondeductible IRA”. And these much better options are =
1) Your employer-sponsored retirement plan
This one is all about considering the option of maxing out that account out before making nondeductible IRA contributions.
This however could make your eligible for an IRA deduction and this is because you are contributing to the workplace plan lower your taxable income for the year.
2) A Roth IRA, if you’re eligible.
And this is the second and last option. And this is about these accounts that are called Roth IRAs which have the income eligibility rules.
But they also have higher than the limits to deduct traditional IRA contributions.