Understanding the Importance of an IRA

Hey Youtube Family, Welcome back to another video! So today we will be discussing what exactly an IRA is? An individual retirement account (IRA) is a tax-advantaged investing tool that individuals use to earmark funds for retirement savings. The original idea for the IRA was initiated in 1974 and was only allowed to be opened strictly through financial institutions. It also was not deductible and limited to an annual contribution limit of 1500 dollars. Despite these limitations, the IRA was very popular garnering over 1.5 billion in investments in its very first year in existence, tripling that number to 5 billion dollars in investments by 1981. Today, that number has hit the 10s of Trillions with approximately 1/3 of American households holding an IRA. I hope this video was super helpful to you. If so definitely SMASH THE LIKE BUTTON, COMMENT, and SUBSCRIBE for weekly content like this. Also, if you have any suggestions or you appreciate some of the edits that I have made to make these videos more easy to follow. Please comment down below. As promised, I also have 3 websites/apps that I highly suggest considering when thinking about opening up an IRA account. 1. Vanguard IRA link: 2. Fidelity IRA link: 3. #investing #individualreterimentaccount #traditionalIRA #RothIRA #influencer #Youtuber #mikejones #whatisanira Here are also three awesome sites that can help you calculate your IRA's potential! 1. Dave Ramsey's Investment and Retirement Calculator: 2. Bankrate's IRA Calculator: 3. Nerdwallet's IRA Calculator: If you are interested in supporting the channel here are two ways you can do so by using my referrals. Robinhood Referral: You now have a claim to a stock like Apple, Ford, or Facebook. In order to keep this claim to your stock, sign up and join Robinhood using my link. Webull Referral: Recommended Beginner Investor Book Disclaimer: The following information provided in this is video is for educational and entertainment purposes. I do not claim to be a financial advisor, regardless of how much knowledge I may possess on the topics discussed. Any decisions that are made should be fact-checked through diligent research and possibly confirmed recommendations from a licensed professional. Thank you for understanding....(read more)

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What is an IRA? Why is it important? Individual Retirement Accounts (IRAs) are an essential tool and one of the most popular investment options available for individuals who want to save for their retirement. This tax-advantaged investment vehicle provides individuals with the opportunity to grow their wealth over time, while enjoying certain tax benefits. An IRA is essentially a personal savings account with tax advantages that are specifically designed for retirement purposes. There are several types of IRAs available, but the two most common ones are Traditional IRAs and Roth IRAs. A Traditional IRA allows individuals to make tax-deductible contributions, meaning that the money contributed to the account is deducted from their taxable income, lowering their overall tax burden for the year. The funds in a Traditional IRA grow tax-deferred, which means that individuals won't have to pay taxes on any investment gains until they withdraw the money in retirement. At that time, the withdrawals are taxed as ordinary income. Moreover, there are penalties for withdrawing money before reaching the age of 59 ½, except for certain qualified exceptions. On the other hand, a Roth IRA works differently. Contributions to a Roth IRA are made with after-tax dollars, meaning they are not tax-deductible. However, the funds in a Roth IRA grow tax-free, and when individuals withdraw the money in retirement, it is tax-free as well. Roth IRAs also offer more flexibility, as individuals can withdraw their contributions at any time tax and penalty-free, although, withdrawing investment gains before reaching the age of 59 ½ may incur taxes and penalties. Now, why is an IRA important? The primary reason is for retirement planning. With the uncertainty of future government benefits, such as Social Security, it has become crucial for individuals to take control of their own retirement savings. An IRA allows individuals to invest their money in a wide range of options, including stocks, bonds, mutual funds, and other assets, giving them the potential to generate substantial returns over time. Another benefit of an IRA is its tax advantages. By taking advantage of the tax deductions or tax-free growth, individuals can maximize their savings and reduce their tax liabilities during their working years. This can be particularly advantageous for those in higher tax brackets. Moreover, IRAs can provide a welcome boost to individuals' retirement savings, especially if their workplace does not offer a retirement plan or if they have already maximized their contributions to employer-sponsored plans like a 401(k) or 403(b). For individuals who want to contribute more to their retirement savings, an IRA acts as an excellent supplement to these plans, allowing them to save even more each year. In conclusion, an IRA is an excellent retirement savings tool that offers numerous advantages. It provides individuals with an opportunity to save and grow their wealth over time, enjoy tax benefits to maximize their savings, and supplement other retirement plans that may be available to them. Whether it is a Traditional IRA or a Roth IRA, taking advantage of this investment vehicle can help individuals secure a more financially stable retirement. https://inflationprotection.org/understanding-the-importance-of-an-ira/?feed_id=140526&_unique_id=6515278cb46cf #Inflation #Retirement #GoldIRA #Wealth #Investing #howtoinvestforretirementinyour50s #howtoinvestmoneyforretirement #individualretirementaccount #individualretirementaccountexplained #investforretirement #ira #mikejones #mutualfundsfordummies #retirementinvesting #retirementinvestinginyour50s #retirementplanning2020 #retirementplanningcalculator #rothirainvesting #rothiravstraditionalira2020 #RothIRAvsTraditionalIRAWhichIsBetter #rothirawithdrawalrules #whatisarothirayoutube #FidelityIRA #howtoinvestforretirementinyour50s #howtoinvestmoneyforretirement #individualretirementaccount #individualretirementaccountexplained #investforretirement #ira #mikejones #mutualfundsfordummies #retirementinvesting #retirementinvestinginyour50s #retirementplanning2020 #retirementplanningcalculator #rothirainvesting #rothiravstraditionalira2020 #RothIRAvsTraditionalIRAWhichIsBetter #rothirawithdrawalrules #whatisarothirayoutube