Individual Retirement Account (IRA)
What is Individual Retirement Account?
A tax-advantaged U.S. account for retirement savings.
Understanding Individual Retirement Account
An IRA lets individuals save for retirement with tax benefits. A traditional IRA may give a tax deduction now, with withdrawals taxed later. A Roth IRA uses after-tax money, and qualified withdrawals are tax-free.
Annual contribution limits apply, and early withdrawals before age 59½ may face taxes and a 10% penalty.
FAQ
Can I have both a 401(k) and an IRA?
Yes. Income limits may affect whether traditional IRA contributions are deductible or whether you can contribute to a Roth IRA.