What is an IRA, and is it right for you?

Individual Retirement Accounts (IRAs)¹ are tax-efficient and popular investment accounts used to save money for retirement.

There are two basic types of IRAs: Traditional and Roth

Traditional IRAs

Contributions are generally tax-deductible² and earnings grow tax-deferred until retirement. Taxes are paid on withdrawal.

Roth IRAs

Contributions³ are not tax-deductible, but qualified withdrawals are tax-free at retirement.

Contribution limits for both types of IRAs may change each year.

So how do you know if an IRA is right for you? Here are seven situations in which an IRA can be a wise choice as you plan for the future.

You are changing jobs: You can continue to make contributions to your account no matter where you work and could have more control of your investments when you move the money from your previous employer's plan into an IRA.
Your employer does not offer a retirement plan: Even if your employer does not offer a retirement plan, you can still invest for retirement with an IRA. Making periodic contributions to your IRA allows you the ability to prepare financially for vocational retirement no matter what.
You are self-employed: Freelancers, independent contractors or anyone who is his or her own boss can prepare for the future with an IRA.
You have maxed out contributions to your employer's plan: If you've maxed out your contributions to your employer's plan and still want to invest more toward your future, look to an IRA.
You prefer tax-free growth: Workers who expect to be in a higher tax bracket during retirement often choose to invest with a Roth IRA. Contributions are taxed at their current rate, but earnings are not taxed, so qualified withdrawals are tax-free during retirement.
You want to lower your current taxes: Contributions to a Traditional IRA could lower your taxes today. And, in most cases, you can make those contributions right up until the tax deadline each year (normally April 15) and apply them toward your previous year's taxes.
Your spouse wants to save for retirement: Whether your spouse is employed or unemployed, opening a GuideStone^® IRA in his or her name (commonly referred to as a spousal IRA) may help you set aside retirement income for specific goals. A non-working spouse who has retirement accumulations from a previous job can roll those funds into a GuideStone IRA set up on his or her behalf by a spouse.

With a GuideStone IRA, you have full access to a wide range of faith-based investment options. This allows you the flexibility to build an IRA that helps meet your investment objectives while also aligning with the values you cherish most.

Learn more about your IRA options with GuideStone.

¹To make contributions to any IRA, you need a source of qualified earned income. Non-working spouses can rely on their spouses' income to satisfy this requirement.

²Your deduction from a Traditional IRA may be limited if you (or your spouse, if you are married) are covered by an employer-sponsored plan and your income exceeds certain levels.

³Your contributions to a Roth IRA may be limited if your income exceeds certain levels.

You should carefully consider the investment objectives, risks, charges and expenses of the GuideStone Funds^® before investing. A prospectus with this and other information about the Funds may be obtained by calling 1-888-GS-FUNDS (1-888-473-8637) or downloading one at GuideStoneFunds.com/Funds. It should be read carefully before investing.

GuideStone does not offer tax advice. Please consult a trusted tax professional.

Retail products such as IRAs, personal investment options and institutional investment opportunities are made available through GuideStone Financial Services^®, member FINRA.

Be sure to consider all of your available options before rolling over your retirement assets. It is important to consider all of the potential advantages and disadvantages of rolling over your retirement assets to an IRA, including the different investment options that are available to you as well as the services, fees, expenses, withdrawal restrictions and tax consequences of rolling over your assets to an IRA. Other options are available besides rolling over your employer-sponsored retirement plan, including leaving the account with your previous employer. An employer-sponsored retirement plan may offer advantages investors can't get if they roll the money into an IRA.