Definition
An IRA funded for a spouse who has little or no earned income, based on the working spouse's income. The couple must file a joint return; the account belongs entirely to the non-working spouse and can be traditional or Roth.
Why it matters
Career breaks for caregiving usually mean retirement saving stops for the person taking the break, compounding a lifelong gap. A spousal IRA keeps both retirements funded and keeps the assets in the non-earning spouse's own name.
Example
One spouse earns $90,000 while the other stays home with young children. Each year they fund the stay-at-home parent's own IRA anyway; at $500 a month and 7% growth, that is roughly $86,000 of retirement money after a decade that would otherwise not exist.
Put it into practice
Related terms
This definition is educational, not financial, legal, or tax advice. U.S. rules and limits change; verify time-sensitive details with official sources. See our disclaimer.