IRAs: Traditional IRA

May 14, 2012 12:00 AM
IRAs: Traditional IRA
" BOSTON (CBS) – Many workers have stopped contributing to their retirement plans. In 2010, which is the last year we have data for, only 14% of U.S. households contributed to any type of IRA. I think a primer on IRAs is needed.

IRAs, Individual Retirement Arrangements, have been around for a long time now (since 1974). And they are a very good way to save for retirement. According to the ICI, the Investment Company Institute, 40% of all households have at least one IRA and there are over $5 trillion invested in IRAs.

If your employer does not sponsor a retirement plan at work such as a 401(k) you can start your own retirement plan using an IRA. As always, whenever the government is involved with money the IRS and Congress set the rules:

You must have earned income, the W-2 kind of income "

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