Are IRAs a good investment?

If you earn money, pay taxes, and want to save money to live on in retirement, individual retirement accounts can help you do so by providing valuable tax benefits. With a Traditional IRA you save income taxes up front because funds you contribute are pre-tax: when you put $6,500 in an IRA, your taxable income by $6,500. If you’re in a 30% tax bracket, that lowers your tax bill by $1,800. Money grows in the account tax-deferred, and you only pay income taxes as you take distributions in retirement. At that point, you’re likely to be in a lower income tax bracket. If you think you’ll be in a higher tax bracket, you can put money into a Roth IRA: the money is taxed up front, but you get tax free withdrawals.