SEP IRA. If your employer sponsors a SEP, or Simplified Employee Pension Plan, you may be eligible for a SEP IRA.  A SEP is a tax-deferred retirement plan that allows the small business employer to make tax deductible contributions to SEP IRA accounts for their employees.  This plan does not allow for employee contributions, unless the plan was established before 1997.

SIMPLE IRA. If you employer sponsors a Savings Incentive Match Plan for Employees, or SIMPLE IRA, you may be eligible to participate.  A SIMPLE IRA is a tax deferred retirement plan available to self-employed individuals or small businesses (those fewer than 100 employees) that have no other retirement plan.  You and your employer can make contributions, however, the plan must be established by the employer.

The two types of IRAs most popular for individual investors are Roth and Traditional. These IRAs have some important differences, especially when it comes to income limits and tax benefits.

In a Roth IRA, you make contributions on an after-tax basis, and any earnings grow free of federal taxes, which means you don't get a tax deduction now, but you won't need to pay taxes on the earnings later. Learn more about Roth IRAs.

A Traditional IRA's key advantage is tax deferral, while possible deductibility means the potential for tax savings today. Any earnings you make may grow tax deferred until retirement. You may be able to deduct your contributions from your current taxes. Learn more about Traditional IRAs.