Individual Retirement Account (IRA) Financial Glossary

What is it? A tax-deferred account that allows individuals to contribute a maximum of $4,000 per year (for current year) toward retirement. Since the investments are not taxed, they can grow more rapidly and benefit from the power of compounding until they are withdrawn. IRA contributions may be fully or partially tax deductible. Types of IRAs to choose from for eligible individuals include the Traditional IRA, the Roth IRA and the Education IRA. (See also IRA/ROTH IRA section above.)

Finance Term Definition Added By: Mckenna

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