3 Reasons To Add An IRA To Your Retirement Plan

No one wants to work forever. Planning ahead for retirement makes it possible for you to maintain a comfortable lifestyle once you stop generating a regular income.

There are many tools available to help individuals plan for retirement, but one tool that can be especially useful is a no-fee individual retirement account (IRA).

Learn more about the ways an IRA can help you better prepare for your future.

1. You Have Exclusive Ownership

An IRA is exclusively yours. This means that you will be responsible for making all decisions relating to the administration of the account. Employer-sponsored 401(k) accounts are the most common type of retirement fund used by working consumers.

You have no ownership in a 401(k); you are merely a participant. Your employer has the ability to change contribution amounts, limit plan features, or switch plan administrators without any prior notification. You also lose the ability to contribute to the 410(k) account if you switch employers over time.

An IRA is independent of your employment. You will be able to contribute to the same account over your working career and adjust your investment options as needed to maximize the amount of money you have available for retirement in an IRA.

2. You Can Enjoy Tax Benefits

Taxes are an unavoidable part of life for working adults. If you are looking for a way to save for retirement and take advantage of some tax breaks, an IRA could be the best option.

Traditional IRAs allow you to contribute pre-tax funds to your account. You can then deduct the total of your contributions from your taxable income for the year, which reduces the amount of taxes you will pay. Once you start withdrawing money from the IRA after retirement, you will be taxed on the disbursements.

A Roth IRA allows you to defer your tax benefit until you retire. The money you contribute to a Roth IRA is post-tax, so you don't have to pay taxes on it when it is distributed throughout your retirement.

3. You Will Enjoy Easy Access

Accessing your IRA account is simple. Most financial institutions and investment companies offer their clients access to an IRA account. You can utilize your personal account dashboard to track growth over time and adjust your contribution levels.

There is no need to go through a third party to access and manage an IRA as you must do with a 401(k) account.

Easy access to your no-fees IRA makes it possible to stay in full control over your retirement funds.

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