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A traditional IRA contribution is a very important retirement tool. IRA stands for Individual
Retirement Account. If you have an income, the IRS predetermines the amount of money
every year that you can set aside at your age category for a contribution towards an
Individual Retirement Account. The IRS changes these rules and guidelines every year, in
keeping with the changing landscape of tax environment. As you get older, if you started
later in life, you're allowed to make catch-up contributions to your IRA, as well. But an
IRA is an important vehicle for an individual to have and is based on how much you get to
save based on how much you have earned. And the IRS sets up all those formulas for your
benefit. The ultimate goal is for you to take that money back out in the retiring years
after you work, so that your Individual Retirement Account will provide you the income that you
used to enjoy while you were working. This is Patrick Munro, financial adviser, discussing
the benefits of Individual Retirement Accounts.