How Do IRA Distributions Work?

Video Transcript

"Hi, my name's Bill Rae. I'm a licensed agent and have been in the financial field for well over two decades. Today's topic is how to IRA distributions work. Well, that's a good question. I suggest that we would start with first of all, what does IRA really stand for? The IRA stands for the individual retirement account. This is a financial vehicle that people use in order to put money away for retirement. In today's market, there are two different IRAs, if you will. One, there's a Roth, and one is your traditional. We won't spend too much time breaking them down 'cause there's a myriad of different things you can do and different vehicles that can be used for that. Suffice to say, that the typical IRA that we're talking about. Distributions simply means your income coming back to you in a timely manner and in a dollar amount that you have decided upon. In a Roth, there can be no taxes and a regular IRA, money the comes back to you could be taxable depending upon whether it's principle or interest earned. Again, this can get complex, so trying to stay light and general, let's simply just say that distributions is the amount of money that you're going to get back from your investment vehicle when you decide to start taking it. I'm Bill Rae and I'm here helping you build wealth."