Contributing to an IRA—or Individual Retirement Account—is a great way to supplement your 401k (or other employer-sponsored retirement plan) if you have one; if you don't, an IRA can be key to your retirement savings efforts. Like many employer-sponsored retirement savings plans, an IRA can offer valuable tax advantages, such as tax-deductible contributions and tax-deferred growth of your savings.

An IRA makes sense for you if you want to:

  • Help secure your retirement with tax-advantaged savings
  • Save more than the maximum allowed by your company-sponsored retirement savings plan
  • Have the flexibility to invest in a range of financial products

MetLife offers several IRA strategies and products that can help you build up your retirement savings.

What type of IRA is right for me?

Traditional IRAs

A traditional IRA allows your retirement savings to grow tax deferred, meaning you won't pay any taxes on earnings until you withdraw your money. Anyone under age 70½ with earned income may contribute up to the allowable limit annually (or 100% of earned income, whichever is less) to a traditional IRA.

For many investors, those contributions may also be tax deductible depending on the amount of the investor's income.

If a married couple files a joint tax return, each spouse may contribute up to the annual allowable limit.

Roth IRA's

If your traditional IRA contributions are not tax deductible, you might consider contributing to a Roth IRA instead. You can never deduct contributions to a Roth IRA.

The Roth IRA was introduced in 1998, and, since then, many investors have opened Roth IRAs or converted traditional IRAs to Roth IRAs. With a Roth IRA, your assets can grow tax-free, meaning you'll never have to pay federal income taxes on your earnings, provided certain requirements are met prior to receiving the distribution. Depending on your situation, tax free growth could possibly result in a larger retirement nest egg than a comparable investment in a traditional IRA.

Other things to consider:

Rollover Opportunities: If you plan to retire or change jobs in the near future, you may face the difficult decision of what to do with the money you've saved through your employer's retirement plan and how this will impact your retirement planning. As you prepare to make this decision, your next steps should include understanding the distribution options available to you, their tax implications, and how each could impact your savings and goals, both today and in the future.

The Stretch IRA Strategy: The Stretch IRA strategy is a planning strategy that can help preserve your IRA and other tax-qualified assets for your beneficiaries. The Stretch IRA strategy focuses on passing IRA assets to your loved ones - when you don't need these assets currently to meet your retirement income needs- by accessing only the minimum amounts required under the tax law.