re: Help me with my IRA understanding

An IRA is simply a kind of brokerage account with special rules regarding contributions and withdrawals. Once you put money into an IRA you can then invest stocks, bonds, funds, etc. just like you can a regular brokerage account. Just about everyone is better off investing in something like a target retirement fund and not trying to pick stocks.

The idea is to contribute as much as possible up to the legal limit for the year (currently $5500) and do this year in and year out. Eventually you'll look at the account and realize you have a pretty good pile. If you do it for an entire working career it can be a really good pile.

There are two major kinds of IRA - the traditional and the Roth. The main difference between the two is that if you contribute to the traditional, then you get to deduct that amount from your income tax bill. When you start taking money out in retirement, it's treated as ordinary income and is taxable. If you try to take any of it out *before* retirement there are stiff penalties, so this isn't advisable.

With the Roth you contribute after paying taxes so it isn't deductible. OTOH, you can pull it back out anytime you like without any penalty at all, and anything you earn is tax-free too when you are retired. This means that you don't need to worry about putting money in an emergency fund unless you've already maxed your Roth contribution for the year.

tl/dr; IRA's are accounts that give you better tax treatment than an ordinary brokerage account.

Protip - 401(k)'s also come in traditional and Roth varieties and have much higher contribution limits, but they are employer-sponsored whereas the IRA is entirely within your control. They are good too though.