What is the difference between a CD and an IRA?

Answer by  sami (14)

IRA means "Individual Retirement Account". It is a taxable account. CD means "Cash or Current Deposit Account". One can deposit cash in bank with a fix rate of income.

Answer by  John (9008)

An IRA is a form of retirement savings that offers tax advantages and helps you save for retirement. A CD is basically just a special savings account with a bank; you get paid interest for letting them keep your money for a set period of time, which varies.

Answer by  timeismoney (994)

A CD is a safe savings investment on which you must pay income tax on interest earned. An IRA is usually a bundle of different investments in a tax deferred account so that you pay no taxes on its earnings until you begin to withdraw it after age 70.

Answer by  tamarawilhite (17883)

CD is certificate of deposit, for depositing your money for a set term, you get a better interest rate. IRA is Individual Retirement Account and can contain CDs or stocks.