An Individual Retirement Account (IRA) provides eligible investors a tax-advantaged way to save for retirement. Whether you are looking to better understand the basics of IRAs, compare IRAs side by side, try a calculator or find out how to open an IRA, we are here to help.
The IRS sets eligibility requirements and contribution limits each year for IRAs.
You can begin taking penalty-free withdrawals from a Traditional IRA at age 59½, however taxes will apply to these withdrawals. For Roth IRAs, you must be 59½ and have held the account for at least five years for the withdrawals to be tax free and penalty free. If you take a withdrawal before age 59½ for either type of IRA, you could face a 10% penalty.
The IRS requires you to take money from a Traditional IRA when you reach age 70½. These withdrawals are called required minimum distributions (RMDs). Roth IRAs are not subject to this requirement. The rule also applies to Rollover, SEP, SIMPLE are SARSEP IRAs, but not to Roths. You do not have to take a distribution from a Roth at any age.
Learn more about these withdrawals for Traditional IRAs by reviewing our RMD Guide.
This information is for educational purposes only and is not intended as tax advice. Please consult your tax advisor for more detailed information or for advice regarding your individual situation.