IRA AND ROTH IRA BENEFITS TO RETIREES

2007-05-02 10:04:19

( Financial )



Benefits of IRA and Roth IRA

IRA and Roth IRA are individual retirement accounts approved by the IRS. It has specific tax benefits designed by the IRS to benefit retirees. This tax privilege is only applicable when you withdraw the proceeds of IRA and Roth IRA retirement plans after retirement age of sixty-five years old.

The benefits of IRA and Roth IRA can provide ample amount of income to retirees of United States after they settle into their retirement lives. Also, it helps Americans save for their future and prepare for their retirements. This way the government envisions its citizens to retire empowered with income from IRA and Roth IRA.

Withdrawal of Funds

Roth IRA, in particular, makes American retirees better off with its option to draw up their retirement funds until seventy-years old. This is particularly appealing to retirees who still have resources to spend after retirement without tapping into their Roth IRA retirement funds. The money that you will not withdraw from Roth IRA will continue to earn tax free. Also, early withdrawal from Roth IRA retirement funds does not merit penalty. However, early withdrawal means you are forfeiting its tax deferred privileges.

Administrator of IRA Funds

You must deposit or maintain the funds for IRA and Roth IRA at financial institutions federally insured and accredited by the IRS. These financial institutions act as custodians or administrators of IRA funds until you withdraw it. Mutual funds, brokers and insurance companies are alternative establishments, apart from banks, approved by the IRS to administer IRA and Roth IRA accounts.

The introduction of IRA as an alternative retirement plan gives opportunity for average Americans to benefit from the service of the federal government in ensuring their future. One should plan well for his retirement. Investing in IRA and Roth IRA is a good step in retirement planning. Avail of its benefits and have a worry free retirement.


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