Retirement Savings Accounts
A sound way to save for your retirement.
Both Traditional IRAs and Roth IRAs offer great benefits to members seeking to save their hard-earned money for retirement. IRA funds can be put into either an IRA Savings account, or an IRA certificate to earn a greater rate of interest. Both retirement accounts allow for primary and contingent beneficiaries, to ensure your funds are protected and your loved ones are cared for.
For 2020 and 2021, members can contribute up to $6,000 per year to their IRA. After age 50, members can contribute up to $7,000 per year to their IRA. Members under the age of 59 ½ will incur a 10% penalty for an early withdraw from their IRA, unless they meet certain circumstances or exceptions.
Traditional IRA contributions are tax deductible, so a person will not pay taxes on the amount contributed to the IRA until funds are withdrawn. Before age 59 1/2, a 10% penalty is assessed on any withdraw (unless it meets the exceptions listed above). After 59 ½, members may withdraw without penalty, only paying taxes on their distribution. After age 72, members are required to withdraw a minimum amount each year, and pay taxes on the distribution.
Roth IRA contributions are post-tax, so any qualified distributions are tax-free. In order to avoid paying a penalty, individuals must hold the account for at least 5 years and be at least 59 1/2 years of age. Before age 59 1/2, a 10% penalty is assessed on any withdraw (unless it meets the exceptions listed above). Unlike a Traditional IRA, members are never required to perform a minimum distribution from a Roth IRA.