IRA (Individual Retirement Account)

A traditional Individual Retirement Account (IRA)is a tax-advantaged account that is designed to help individuals save for retirement. The IRA saver does not pay taxes up front, but at the time of withdrawal, typically during retirement.

There are two different types of IRAs: Traditional and Roth IRA’s. Traditional IRAs offer tax deductions of up to $5,550 a year ($6,500 year for those 50 and older). Roth IRA contributions are made with post-tax dollars, while Traditional IRA’s are made with pretaxed dollars. The difference is you are not taxed when you take your Roth retirement payments. However, there are limitations pending salary.