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Wednesday, April 23, 2014

Individual Retirement Accounts

An Individual Retirement Account (commonly called an IRA) is a retirement investment plan that provides many individuals with tax advantages in exchange for saving for their own retirement. There are several IRA options including Roth, Traditional, SEP, SIMPLE and Self-Directed plans, each with a slightly different purpose and tax benefit. Most common of these are the Traditional and Roth IRA plans.

A Traditional IRA may allow you to deduct contributions on your income taxes now and pay the taxes when you make qualified withdrawals in retirement. There is no income limit to contribute. A Roth IRA offers the opportunity for federal tax-free growth and tax-free withdrawals. Unlike Traditional IRAs, Roth IRAs have income and eligibility requirements.
 
For more details regarding the tax implications and eligibility requirements of the different IRA plan options, please click here to go to the IRS website.
 
DMB Community Bank offers several account options for your IRA plan investments. Not only can DMB help you open an IRA account, but we can also help you transfer a retirement plan from another institution or rollover a plan that you left behind with a former employer.  Whether beginning your retirement planning process or already enjoying your retirement years, DMB can help. Click here for our current IRA rates.
 
 
Minimum to Open
$25
$500
$500
Deposits Allowed?
Yes
No
No
Withdrawals Allowed?
Yes
Only at Maturity
Only at Maturity
Interest Paid
Monthly
Annually
Annually
Interest Rate
Variable, may change monthly
Fixed for term
Fixed for term
 
1 Year IRA Variable – This account is ideal for you if you’re just starting your retirement savings or if you will need access to your retirement money on a regular basis. It’s like a regular savings account in that you can make regular deposits and withdrawals (withdrawals made before you attain age 59 ½ may be subject to IRS penalty). Like the name suggests, the interest rate is variable, changing with the market conditions.
 
2 Year IRA (Fixed) – This account is ideal for you if you have money already saved, will not need to withdrawal it within the next two years and would like to earn a higher rate of interest. Much like a CD, this account is a time deposit (two years in this case) and we guarantee you a certain rate for that entire time period.
 
4 Year IRA (Fixed) – Just like the 2 Year IRA above, but with a longer (four year) term and even higher interest rate.
 
For more information on our IRA products and services or to request an account disclosure, please Contact Us or call a Financial Services Representative at 608-846-3711.