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a 401(k). People 50 and older may also make catch-up contributions to these plans. The tax benefits are much the same as a Traditional IRA.
My how your money grows
The following shows how your money can grow at just 4% interest in an IRA account. You can see the value of beginning early, but anytime is better than never starting at all. Based on a $3,000 per year contribu- tion beginning at the age of 25:
Simple IRA Contributions
The total investment over a 40-year period is $120,000 but because of the compounding of interest, you make over $170,100. The result is more than double your initial investment.
AGE 25 35 45 55 65 RETURN $3,000 $36,000 $90,000 $170,350 $290,100
Individual Retirement Accounts 73
