What is a Traditional IRA?

A Traditional IRA is and Individual Retirement Account which allows individuals to save for retirement. The name Traditional IRA is used to identify how it will be treated by the IRS.

When an individual opens a Traditional IRA they can then place investments in this account, or use a service like jazzWealth to manage the investments for them. The investments can include stocks, bonds, exchange traded funds, and mutual funds among other investments. The investments grow "tax deferred" until retirement. This means that none of the gains or contributions are taxed until an individual begins to withdraw their money in retirement.

Advantages

  • Investments grow tax free until retirement
  • Contributions may be tax deductible in the year of contribution
  • Wide variety of investment options
  • Protection from creditors

Disadvantages

  • Taxes in retirement could be a burden if one expects to be in a higher tax bracket
  • Tax rates in the future are uncertain
  • A full tax deduction may not be allowed if current income is above limits
  • Mandatory withdrawals must begin at age 70 and a half
  • Investors are limited by the contribution cap

Why choose jazzWealth for your Traditional IRA?

  • Do not understand the investment process
  • Do not have time to manage ones investments
  • Need personal financial advice along the way
  • No trading commissions or fund fees

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