Are there different kinds of IRA accounts?
The simple answer is, Yes. There are a few different types of IRA accounts, all of which have slightly varying rules or regulations. Roth IRA-Contributions to a Roth IRA are made after taxes have been levied, therefore, all account transactions are tax-free and withdrawals are usually not taxable. Traditional IRA-Unlike the Roth, contributions to a traditional IRA are tax deductible and taxes are paid on withdrawals after retirement. Simple IRA-A simple IRA allows both individual and employer contributions. It is similar to a 401k or pension plan, and often acts as one for employers who do not offer 401k’s but want to offer retirement benefits. Although it is called an IRA, the contribution limits are lower than other types of IRA accounts and administration of the Simple IRA is easier than other IRA accounts. Self-Directed IRA-This account is more complicated than other IRA accounts, as the individual allocates the investments in the account. A self-directed IRA is intended for those
