That adventurous future you’ve imagined is going to cost money. And opening an IRA (individual retirement account) is a great way to help you save up. But since your IRA won’t fund itself, here are three things you should do to help your retirement savings keep up with your future self.

Re-energize your balance.

First, the obvious: if you haven’t already—or if it’s been awhile—just get some money in your IRA. After all, each year you put off making IRA contributions is retirement income lost.

Deposits to your IRA are known as contributions. The sooner you get a balance in there, the sooner you can take advantage of the tax benefits and earning power of your retirement account.

You can fund most IRAs with a check or a transfer from a bank account. That option is as simple as it sounds.

You can also put existing retirement funds into your IRA, but that requires a little more consideration. Moving funds from any type of retirement account to an IRA is called a transfer, a rollover, or a conversion.

The basic difference is this: a transfer occurs between accounts of similar type; a rollover occurs between different account types. For example, moving funds from an IRA at one institution to an IRA at another is a transfer. Moving funds from a 401(k) to a traditional or Roth IRA is a rollover. A conversion occurs when you change a traditional IRA to a Roth IRA.

The main thing to remember about both rollovers and transfers is that any existing retirement funds should go directly into the IRA without making any pit stops in your other accounts. That way, you avoid paying unnecessary taxes on those amounts.

Play by the rules.

The last thing you want is to be penalized for not knowing IRS contribution rules. One hard and fast rule to know: you must have earned income to open and contribute to any IRA. The rest of the rules governing federal limits on annual maximum contribution amounts are based on your income, age, IRA type, filing status, and other factors.

You can contribute to more than one IRA in the same year, but the total amount can’t exceed that annual limit set by the IRS. The most common limit guidelines include:

  Roth IRA Traditional IRA
Contribution limits $5,500 age 49 and younger; $6,500 age 50 or older Same as Roth
Income limits Income affects how much you can contribute.  Current limits Income does not affect how much you can contribute.
Age limits Contribute at any age Contribute until age 70½


It’s a good idea to consult with a tax professional familiar with your situation and visit the Internal Revenue Service website for specific, up-to-date information.

Make—and stick to—a plan for regular contributions.

Whether you see your future self on a tour bus, on a humanitarian mission, or in your backyard garden, you’ll want to come up with a solid plan to help you get there.

Of course, in general you will only get the maximum tax benefit from making the maximum annual contribution to your IRA, but only you can determine what amount is realistic for you. Most experts will tell you that making regular contributions gives you your best chance at long-term success.

One way to make sure you’re contributing regularly is to set up an automatic transfer to a savings account that you can then earmark for IRA contributions.  Once you’ve determined an annual contribution amount that makes sense for you, you can divide that into equal amounts to be transferred on a regular basis, say, monthly or every payday. Then, you’ll have the money in your account to contribute. You may already be using a similar strategy with your savings deposits.

A quick evaluation could be all you need to make sure your IRA is doing what it’s meant for: funding your future. What do you see yourself doing in retirement? Share in the comments below.

Don’t have an IRA yet? Visit our IRA basics to see if opening one makes sense for you.