Do you know what an IRA is? Easy, it is an individual retirement account, but it is better known as an IRA, for its acronym: Investment Retirement Account. This financial tool is an account that people regularly open to save money for their future. This account, in addition to giving you the benefit of savings, becomes a tremendous opportunity. You want to know why? Here we tell you what those 5 benefits are:
1. You can deduct it from you tax return
Just as you read it, the IRA can represent a tax reduction on your income tax return. This benefit can apply to you with or without a partner. But be careful, to be able to take the deduction on the return you can only contribute until the taxable year in which you have reached 75 years of age.
2. It allows you to save in the short and long term
The IRA makes it possible to save on your payroll at the moment, you save by deducting it from your tax returns, avoiding, in many cases, the payment you have to make each year. In addition, you can use it as a savings technique and strategy that will help you continue with your expenses in years.
3. The contribution is flexible
If you are single, you can contribute up to $5,000 per year to an IRA. However, if you are with your partner, the amount goes up to $10,000. You could also opt for an Educational IRA where the contribution is up to $500 annually. With this option, you will help defray the costs of the post-secondary education of a minor, whether children, grandchildren, nephews, etc.
4. There are options that suit you
In general, most people can apply for an IRA. Therefore, the possibility of having one and depend on its benefits is real and accessible. Depending on the IRA you choose, you can open it with up to $100 or $250.
5. You can withdraw it in particular situations
IRAs are typically created to save and withdraw money at retirement. However, this money can be withdrawn before that period if it is the purchase of the first home, the university education of dependents, the repair of the residence due to accidental causes, a chronic, terminal or degenerative illness, avoiding mortgage foreclosure, computer purchase, payment of alimony debt, unemployment or disability.
We hope that these 5 benefits of having an IRA account will be of great help to you in your finances in the short and long term.
