As a long time funding option, Individual Retirement Accounts (IRAs also known as individual retirement arrangements) evolved in recent years to become more practical. Here are a few key things to know when exploring your Traditional IRA options:
- While IRA annual contribution limits stayed stationary at $2,000 for decades, the powers that be wised up! Around a decade ago, they started basing routine contribution limits on inflation. Current contribution limits are $5,500 per tax year and $6,500 per tax year for individuals 50 and over. As of the writing of this feature, those amounts are increasing in 2019.
- Traditional IRAs, while intended for retirement, may also be withdrawn for a dependent’s college education (always consult a qualified tax professional to review your situation).
- Lastly, many people think of Bank IRAs invested in Certificates of Deposit (CDs). The reality is that the term “IRA” merely notates a tax qualified status and not a specific investment type. So, choose any number of investment vehicles within an IRA!
Consult a qualified tax professional or financial advisor to see if a Traditional IRA is right for you.
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Always remember that while this is an investor education piece, this does not trigger or relate to trading activity on your account with Financial Future Services. This article is for informational purposes only and not intended as a recommendation. Each investors circumstances are different and a full review of you situation is necessary for a recommendation.
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