An effective retirement plan usually combines a savings strategy with the added leverage of tax deferral. Most working individuals can realize tax benefits now by utilizing one of First Class American Credit Union’s retirement accounts to provide for a more secure future.
What is an IRA?
An Individual Retirement Account (IRA) is a separate account specifically established to receive funds intended for future use while also providing a current tax deduction. Both the original contribution and subsequent earnings are taxed when eventually distributed, presumably when the account holder is in a lower tax bracket. Earned income must equal or exceed the deduction, and taxable alimony can be considered qualifying income for purposes of an IRA.
IRA contribution limits are dependent on age.
- Up to $5,000 can be contributed yearly.
- If age 50 or over, an account holder can contribute $6,000.
- An additional $5,000 can be contributed for a nonworking spouse.
- If married and both are age 50 or over, $12,000 can be contributed.
- See our specific interest rates for IRA’s and IRA CD’s.
Roth IRA Differences
A Roth IRA contribution is not tax-deferred and so is not taxed again when eventually distributed. A major difference is that the entire Roth distribution is tax-free, including the accumulated earnings. The annual contribution limits are the same as for a traditional IRA.
What is an IRA Certificate of Deposit?
An IRA Certificate of Deposit combines the steady interest of a certificate of deposit (CD) with the tax advantages of an individual retirement account (IRA). It offers: Stability. In a world of fluctuating investment values, individuals enjoy stable earnings they can count on.
Benefits of a IRA Certificate of Deposit Account with FCACU
Our IRA CDs are a great retirement investment option for members who desire a higher fixed rate of return but don’t want any risk. IRA CDs are best for those of our members who don’t need the money in the near future and they allow members to hedge their money against fluctuating interest rates by locking them in for longer periods.
Other features of our certificates of deposit are:
- Open a IRA certificate account with as little as $1,000.
- Deposit $50,000 or more and earn even higher dividends.
- Dividends are paid monthly and added to the principal balance of your IRA certificate or transferred to another account.
- We offer some of the most competitive rates available.
- IRA certificate accounts are available in 6 month, 12 month, 18 month, 2 year, 30 month, 3 year and 4 year durations.
- 30 Month IRA Certificate “Bump-Up” option. (See our rates page for details).
As one of the oldest credit unions in the state, FCACU is focused on helping members of the community. Our goal is to ensure that each and every member can build wealth by making sound financial decisions. An IRA is one of the cornerstones of retirement planning, and you can put our experience to work for you. If you’d like to set up an IRA with First Class American Credit Union, contact us today!