The perfect stock for your IRA needs to provide growth, stability, or dividend income -- or some combination of the three. The best investment options really depend on your personal circumstances, but a great stock has to fulfill a role. Younger retirement savers need to prioritize growth, whereas people approaching retirement might want to find a more reliable company that produces passive income. These three stocks might not all be the best thing for everyone, but each of them does a great job of fulfilling a particular role in a traditional or Roth IRA.

1. Alphabet

Alphabet (GOOGL -0.27%) (GOOG -0.28%) is a useful stock for investors who have a need for growth. The tech giant averages nearly 20% annual growth, but it can be acquired at a reasonable valuation with a forward price-to-earnings (P/E) ratio of only 27. That's especially relevant for investors building a Roth IRA.

The company has also developed real staying power by achieving leadership status in multiple growth industries. Alphabet leads the global market for internet search and digital advertising with its Google and YouTube products. Its Android products completely dominate mobile operating systems worldwide. It's also a major player in cloud computing. Alphabet spends heavily to retain its competitive position across diverse categories, too. The company has already invested more than $15 billion on research and development and $2 billion on acquisitions so far this year.

Alphabet is too big to be a hyper growth stock, and it's not quite mature enough to start paying a regular hefty dividend. However, Alphabet can more than outpace the market based on its sales and profit forecasts. This company is clearly no flash in the pan, and investors can expect it to keep notching big numbers for years to come. That's a rare combination, and that's exactly what makes Alphabet such a great stock for your IRA, whether you're young or retired.

Person drawing graph on paper with retirement plan written on it.

Image source: Getty Images.

2. Verizon

Verizon (VZ 0.32%) is one of the largest telecommunications providers in the world, and it leads the U.S. wireless market with over 40% of subscribers. Large telecom providers have a lot in common with utilities. They receive predictable monthly revenue from a large number of customers, much of which is contractually determined. People usually don't drop their wireless service during recessions, so Verizon isn't particularly cyclical. These characteristics are perfect for retirees who want stability and income in their IRA.

There's certainly competition from AT&T and T-Mobile US, especially as all three are rolling out their 5G networks. That's a long-term risk, and the whole competitive balance could be shaken up again in a few years whenever 6G is implemented. There could also be a major paradigm shift to technology such as satellites or an ambitious project like Google Loon. That makes Verizon a less certain option for the long-term, but the short-term narrative is still stellar.

Verizon has already established itself as a major player in 5G, and people won't be ditching their mobile devices any time soon. It should therefore continue to grow at a slow and steady pace as more people and devices join the next generation wireless network. Even with Verizon's planned $18 billion in capital expenditures for the full year, the company is on pace to produce more than $20 billion in free cash flow. That's roughly double the amount that it's expected to pay in dividends. Despite having ample and predictable cash flows, Verizon pays a high 4.6% dividend yield. That makes this a compelling candidate for retirees looking for income stocks.

3. Mastercard

Mastercard (MA 0.85%) is looking to build an innovative fintech disruptor on top of a proven, cash-flow generating business. The company famously offers electronic payment network services, trailing only Visa globally in that market. As more and more card payments are processed, Mastercard is one of the main beneficiaries. So far in 2021, Mastercard has ridden economic recovery to 18% year-over-year sales growth, and it's produced more than $3.3 billion in free cash flow. That's more than enough to support its modest dividend and any debt payment obligations, so Mastercard is simply churning out cash right now.

That's enticing, but Mastercard stands on unpredictable ground as the fintech revolution occurs around it. Tech giants, start-ups, traditional finance powers, and blockchain solutions are all complicating matters by bringing speed and efficiency to payment transfers. Mastercard has responded to these looming threats by making acquisitions and developing partnerships to maintain and enhance its competitive position. These include:

  • Enhancing its fraud prevention capabilities with the purchase of Ekata
  • Expanding its service offering with Finicity and Aiia
  • Entering cryptocurrency services with CipherTrace

Mastercard is clearly positioning itself to be a key player in the next generation of financial services, and the substantial cash flow that its generating can only help with that goal. As it stands, analysts are forecasting double-digit growth in the next few years, and the stock can be purchased at a fairly reasonable forward P/E ratio of 33. That's an attractive opportunity for long-term appreciation without taking on too much risk today.