IRAs offer powerful tax advantages and flexibility — but many Americans aren’t using them to their full potential. Whether you’re just starting out or nearing retirement, making the right moves now can mean thousands more in your future nest egg.
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GOBankingRates spoke with Stephanie Temporiti, wealth advisor at Hightower Wealth Advisors in St. Louis, about the things everyone with an IRA should do to best harness all of their advantages.
The IRS allows individuals to make tax-deductible contributions up to $7,000 for 2025 ($7,500 in 2026) for those under age 50 and up to $8,000 ($8,600 in 2026) for those age 50-plus. This is a great way to accumulate retirement savings during your career.
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Most young adults entering the workforce are in a much lower tax bracket than they will be later in their careers. This includes young adults and students who earn money from lifeguarding or babysitting with a summer job. Parents and grandparents can contribute on their behalf to a Roth IRA — up to 100% of their earned income or $7,000 for 2025 ($7,500 in 2026), whichever is less.
Starting to save in a Roth IRA will allow those funds to grow tax-free forever, and the money isn’t taxed when it is eventually withdrawn.
Use the power of a globally diversified portfolio to mitigate market volatility and harness steady returns over time. An IRA is a great tool to reallocate investments without incurring taxes, keeping your portfolio in balance for overall risk changes while keeping you on track for your financial goals.
If you are a business owner, there are advantages to saving in different types of IRAs that offer additional savings for you, including SEP IRAs and SIMPLE IRAs. Work with a financial professional to understand the rules and advantages of these accounts.
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This article originally appeared on GOBankingRates.com: I’m a Financial Advisor: You’ll Never Regret Doing These 4 Things With Your IRA
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