Traditional IRA
Traditional is a relative term. If you call tax- advantaged savings that leave you in position to enjoy your retirement "traditional," then traditional IRA is perfectly named.
In addition to tax-deferred earnings, contributions may be tax deductible. Capitalizing on compound interest will leave you with the ability to do...well...whatever you want with you're retirement. You'll have the money for it.
- Summary
- Current income grows tax free
- Interest earnings are tax deferred
- Contributions may be tax deductible*
- Compound interest on entire balance
- Can contribute up to $5,000 per year
- Additional $1,000 "catch up" contribution allowed for ages 50+
- Withdrawals can begin at age 59½
- Early withdrawals subject to penalty**
- Mandatory withdrawals begin at age 70½
- Invest within IRA via variable rate account, fixed-rate CDs, or both
- $500 minimum deposit to open
- FDIC insured
*Consult with a tax advisor.
**Certain exceptions apply, such as healthcare, purchasing first home, etc.
