An Individual Retirement Account (IRA) is a type of investment account specifically designed to help individuals save for their retirement. There are two main types of IRAs: Traditional IRAs and Roth IRAs.
Traditional IRA: Contributions to a traditional IRA may be tax-deductible, and the investment grows tax-free until it is withdrawn, at which point it is taxed as ordinary income.
Roth IRA: Contributions to a Roth IRA are made with after-tax dollars, and qualified withdrawals in retirement are tax-free.
Both types of IRAs have contribution limits and other rules that must be followed, so it's important to consult a financial advisor or tax professional before opening an IRA or making contributions.
In general, IRAs can be a good way to save for retirement and receive some tax benefits, but it's important to consider your individual circumstances and long-term financial goals when deciding whether an IRA is right for you.