Certain IRA rates, such as those for taxation, vary with different investments, but other IRA rates are more predictable, such as the fixed rate the the government sets for placing money into an investment. Interest rates for a given investment obviously cannot be determined unless the investment is based on static securities like bonds. All investments charge an administration fee but the amount varies for different investments. The lowest fees are offered by simple IRA provisions that barely have any use today.

Payments for an IRA investment are under a fixed rate that is imposed by the government. The rate only changes with the age of the account holder, so if you’re closer to retirement you can save more. This makes it helpful for people who begin an IRA investment later in their working career. Having this rate in place means that the investment occurs over time, as there are strict limits on how much money you can contribute to an IRA investment each year. You can only make payments to your IRA account with cash or the like, and lump payments are not possible at any time or for any reason.

Penalty rates for IRA investments, which apply for money withdrawals that are made before you reach retirement, can also vary. The existence of penalties is needed to prevent people who want to use an IRA for short term investment purposes just for the purpose of avoiding tax. Penalties apply whenever you take out money from your IRA account, although there are only rare exemptions that allow you to withdraw money penalty free. Repeated withdrawal resulting in penalties leads to an inefficient investment.

You are, however, able to predict rates of return on an IRA investment. This depends on how well the securities you have chosen perform in the investment. You cannot receive any sort of advice from the trustees managing the investment, even if a commission payment is offered. The only way to get advice if you need it is to open a separate account with a broker, who can give you the advice you’re after, and you can purchase the same stock in your IRA.

The purpose behind an IRA is to serve as investment vehicle that offers tax concessions on investments. This applies to profit made from an investment and depending on the IRA plan, concessions also allow savings on payments made into the investment. You won’t be able to predict taxation rates which apply at retirement. However, you can avoid this altogether by choosing an Roth IRA which uses a tax system that is different from that of a traditional IRA.

Working out predictable IRA rates accurately is important as an IRA investment is based on compound interest. With this system, even a very minor interest rate shift at the beginning of an investment can result in an increased sum of money when you reach retirement. It’s best to compare many products and get expert advice before going ahead with an IRA investment. An IRA expert will be aware of all the important IRA rates you need to know.