All retirement investments are tax-deferred. You may also pay a penalty tax if you withdraw your retirement investments before you are 59 years old. If you are eligible for one of these plans, you will want to contribute as much to it as you possibly can. Your contributions are tax-deductible. The contribution limits are adjusted over time to reflect inflation.
Many employers make matching contributions to add to their employees' savings.
Fixed and Variable Annuities Annuities are tax-deferred investment contracts issued by insurance companies. Fixed annuities pay a guaranteed rate of interest each year. Variable annuities offer a variety of stock and bond investment alternatives. In both cases, your principal is guaranteed upon death. Your contribution to an IRA will be tax-deductible if you are not a participant in any other retirement plan or if you meet the family income test.