IRA Advantages and Disadvantages
- Author Jennifer Quilter
- Published August 24, 2010
- Word count 371
The IRA advantages and disadvantages really come down to one major factor, control over your account. There are other things to consider of course but it is the thing that sets these plans apart from other types of retirement accounts.
An independent retirement account is set up, as the name suggests, independently. You find a company to set up your account with, and decide on what type (most commonly a traditional or Roth) of account you want. You pick all of your investments (stocks, bonds, etc) on your own (or with the help of a financial adviser).
This level of control over your IRA can be both an advantage or disadvantage depending on your outlook. A lot of people like picking each of their investments because they like having detailed control over their investments and enjoy trying to find the best strategies possible. This is not for everyone, however, and everyone needs to save for retirement.
With a 401k, for instance, your employer will set up a couple of different plans for you with varying levels of risk for you to choose from, making the choice over how to invest much simpler (but with a lot less options and control). Another option if you dislike this level of control is to consult a financial adviser for your investment options to help narrow down some choices and get some advice on how to move forward.
The other major thing to consider, which is definitely a negative aspect if you're planning on making an independent retirement account a large part of your savings plan, is the fact that these accounts have lower maximum contribution limits in comparison with other options, in fact their limit is less than 1/3 of that for a 401k.
With all of this to take into consideration it can be hard to make a decision on how to invest. The easiest way to decide is what feels right to you--don't let the fear of investing "wrong" to scare you away from saving at all--the most important thing is that you save for retirement, no matter how you do it. The IRA advantages and disadvantages are really just about control, so decide what makes sense to you and go from there.
Retirement accounts don't have to be so confusing. Learn more about your retirement savings options, like what the IRA and 401k maximum contribution limits are, what your account balance goals should be, and look at Roth vs Traditional IRA plans.
Article source: https://articlebiz.comRate article
Article comments
There are no posted comments.
Related articles
- SCOFI: Pioneering Venezuela’s Petroleum Industry for Over 65 Years
- To Understand Risk, Start By Asking What You Don’t Know
- How To Make Money On Binance: A Full Guide
- Airbnb Investment 101: Tips for New Hosts in Australia
- Indian Gold Demand Rebounds During Important May Festival
- The Investment Terrain in Crypto, Blockchain, and Web3
- Exploring Bitcoin: Corporate Giants Embrace the Cryptoverse
- The Significance of Static IP Address for Trading
- TYPES OF FOREX REGULATIONS
- Weekly Events: Avalanche & Chainlink Collaboration, CommEx Closure, And More
- Assani Elolo Ronaldo - How Bank Instruments Facilitate Gold Deals
- Crypto News: Mempool Solana Shuts Down, Police Integrate Cardano Into Their Work, WhiteBIT And FC Barcelona Launch New Course
- Is Crypto Entering 2021 Vibes?
- Bitcoin Updates All-Time High In Momentum Amid Its Scarcity
- Analyst Announces Bull Run Start, Cites Stock-to-Flow Strategy
- Weekly Crypto News: Telegram Pays Toncoins, WhiteBIT Is Now TradingView Broker And More
- undetectable banknotes
- Unlocking Financial Success: Why Successful Portfolios LLC is Your Best Advisor
- Are EVs a Threat to the Republic?
- A Deep Look Into Binance: Can It Really Be Trusted?
- Ledger Live - Most Trusted & Secure Wallet - Ledger
- Decoding the Future: Navigating the Crypto Landscape
- Don't Cry for Me General Motors
- Investing in exponential growth stocks: what can you choose
- Leveraging ChatGPT AI for Smarter Stock Market Analysis and Investments
- Shib, Doge, and Pepe Have a New Competitor: The Rise of $FUFU Token
- Unlocking Wealth: The Power of Apartment Syndication in Real Estate Investing
- 6 Reasons to Invest in Bitcoin
- Blockchain and AI Convergence: A New Era of Innovation
- Financial Planning for Small Business Owners: Tips for Success