How does a retirement account work? how how does my money grow by investing in a retirement account?

I know that once I invest money in a retirement account I can't touch it unless it's for emergencies but I would like to know how does my money grow in this type of account and how soon can I see results?
How does a retirement account work? how how does my money grow by investing in a retirement account?
When you are investing, you have to invest for the long term to see any results. In the beginning years, you may be quite emotional to the market fluctuations. If market went down, the value of your portfolio went down. Your natural response would be, "I lost money." But the fact is you haven't lost or gain any money because you didn't touch your money. How your portfolio performs depends on these factors:


1) What is your average price per share compare to current price per share?


2) How long have you had the investment?


3) Dividends and capital gains payout (if any)


4) Type of investment. Are you invested in conservative funds or large growth funds? If you want higher growth, you need to be willing to accept higher risks.


5) How disciplined are you? Are you going to pull out when the stock market is down or are you going to stay in and continue to invest?
Reply:There are many times.





The common denominators is tax advantaged savings.





Either tax deferred or tax free gains.





A 401K is a company sponsered account, and they often do a match of some contributions.





A traditional IRA is a has tax deffered gains


A Roth IRA has tax free gains.





Most financial institutions will let you start an IRA with them. I use Scottrade and invest in mutual funds and stocks.





Company 401Ks are usually limited to the investments the company has to offer.





Most banks have limited investments also.





I have a small Roth IRA at my bank, that keeps my minimum balance so I can get all the freebies. It does not earn much, but I get free safe deposit box, free checks and free money orders because of it. It is just in a money market CD that only makes 3.5%, but I gain 10 times that in freebies.





My particular bank, has very "expensive" mutual funds that I will not buy because it would be dumb.





A great book, that helped me, is "More Wealth without Risk" by Charles Givens. You can find it at any library.
Reply:Your money goes into a special pension fund managed by a professional investment expert, who invests it in the stock market.. You also get some tax back, so it becomes cheaper. When you retire, the fund manager buys an annuity for you, which gives you a guaranteed income for life. The size of the pension will depend on how well the manager has performed. So there is a large element of luck involved.