Your contribution to a Traditional IRA may be tax-deductible, depending on your income and whether or not you participate in a retirement plan at work. Use our Guide to Traditional IRA Deductions to check your IRA deductibility.

If you are eligible for a tax deduction, your current-year tax bill will shrink every time you invest. For example, if you're in a 28% bracket and make a $5,500 ($6,500 if age 50 or older) fully deductible contribution to a Traditional IRA, you'll save $1,540 on your taxes that year.

Whether or not your contributions are deductible, all earnings in a Traditional IRA grow tax-deferred. You don't pay taxes until you withdraw your money,¹ which usually is during retirement when you may be in a lower tax bracket.

• Guide to Traditional IRA Deductions
• Features
• What You Need to Know about the Traditional IRA

1. Withdrawals before age 59½ may be subject to a 10% penalty tax.

This material is not intended to replace the advice of a qualified attorney, tax advisor, investment professional, or insurance agent. Before making any financial commitment regarding the issues discussed here, consult with the appropriate professional advisor.