Personal Finance

IRA (Individual Retirement Account)

A tax-advantaged retirement account you open yourself, outside of work.

An IRA is a retirement account you control directly at a broker. A traditional IRA may give you a tax deduction now and taxes you on withdrawal; a Roth IRA is funded with after-tax money and grows tax-free. IRAs have annual contribution limits set by the IRS.

For example

You can open an IRA at a broker, contribute up to the annual limit, and invest it in index funds for retirement.

Related terms

Roth IRA401(k)

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