IRAs

If your goal is to pay less in taxes now, a Traditional IRA may be right for you. Traditional IRAs let you use pre-tax dollars to make contributions, letting you build your principal sooner for greater earnings later.

With federal income tax deferred, as well as the added possibility of receiving yearly tax deductions, your contributions and earnings can grow faster, free from the burden of taxes.

While Roth IRA contributions are not tax deductible, unlike a Traditional IRA, they have more flexibility baked in. More people are eligible, couples can contribute more, and you can keep on saving for retirement as long as you have earned income up to a certain amount.

There are also no mandatory distribution requirements and you may be eligible to access your contributions without any IRS penalties. It is even possible to convert your existing 401k or traditional IRA account into a Roth IRA to take advantage of wider tax benefits.