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Individual Retirement Accounts

First Credit Union

First Credit Union offers Individual Retirement Accounts (IRAs) that allow members to save for retirement. Both Traditional and Roth IRAs have significant tax advantages. Finding the right IRA for you is key to working toward the retirement you are dreaming of. First Credit Union IRAs feature:

  • Tax deductible contributions
  • Tax deferred dividends
  • Low $25 opening deposit
  • No monthly service fees

Traditional IRA

For anyone under age 70 ½ who has earned income or files jointly with a spouse who has earned income.

For anyone who has received a distribution from a qualified retirement plan and decides to move the proceeds to the plan into an IRA.

Benefits
Earnings grow tax deferred until withdrawn.
Contributions may be tax deductible.
Penalty free withdrawals for qualified education expenses, first time home purchase* and qualifying medial expenses.

Roth IRA

For anyone who has earned income and your modified adjusted gross income is less than the defined limits set by Congress.

Benefits
Earnings are tax deferred and withdrawals are tax free if the account is open for five years and withdrawals are for a qualified reason including: age 59 ½, disability, death or a first time home purchase*.
Not required to begin withdrawals at age 70 ½.

Retirement Calculator

So which is better for you, a Traditional or Roth IRA? Our Retirement Calculator can help you explore your options considering your personal situation.

If you are eligible to contribute to both a Traditional and Roth IRA and are unsure which account is right for you, here are some general rules-of-thumb:

Choose a Traditional IRA if you want the tax deduction right now. It is also a better choice if you anticipate paying taxes at a significantly lower rate in retirement.

Choose a Roth IRA if you don't need the tax break right now. Its flexibility allows you to withdraw regular contributions at any time, tax and penalty free. Also, you do not have to take mandatory distributions at age 70 ½.

Not intended as tax advice. Please consult a tax professional.

 

*Lifetime limit for exemption on first time home purchase is $10,000.

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