Holiday traditions often include giving gifts to friends and family. Why not give yourself a gift for the future this year by investing in a new or existing Individual Retirement Account (IRA)? It can also be a gift when tax time rolls around next April, depending on the IRA you choose.
IRAs for the Future
IRAs are considered a quintessential way to save for retirement. For those who don’t have a retirement plan through their employer, it may be a good alternative. Or it can be a supplement for those who do.
IRAs also offer tax-advantages—some later and some now—depending on whether you choose a Traditional or Roth. Both offer a tax advantaged way for your money to grow. And there are no age limits for who can contribute, but you must have earned income.
For 2020, you can add up to $6,000 into a Traditional IRA, or into a Roth IRA, if you qualify. If over age 50, the IRS limits you to $7,000. From there, the two have differences.