You avoid taxes on the income and growth of the IRA and when you draw money out it is not taxed. You have a limited time to transfer current IRAs into Roth IRAs but the decision is not easy because you have to pay taxes on your old IRA gains to do that. I can show you excellent web sites or financial firms that give you help with such decisions at no cost to you. A few more bucks roll in. When that child grows up and eventually retires, he or she can draw out each week for life, the amount you put in once a year when they were your dependent.
Taxes can be expensive.
When a fund sells a loser the tax benefit is lost with the gains they take. But if you sell a losing stock you get money back on your taxes. When you are a stockholder and you learn a certain company no longer behaves according to your ethical standards, you can write to them and say what you like and don't like about corporate conduct. Finally, you can always sell your shares if they fail to respond as you like. You have no such clout with a mutual fund.