Traditional and Roth IRAs

Invest in Your Future with an IRA (Individual Retirement Account)

There is no better time to start saving for retirement, than right now! Whether you’re just getting started or looking to supplement an existing 401K with your employer, we can help. At UECU, we offer an array of retirement savings options.

UECU’s IRA Benefits:

• Multiple savings options with tax advantages (Traditional IRA, Roth IRA, IRA Certificates of Deposit, and Coverdell ESA)
• Competitive dividends consistently higher than the national average
• Insured up to $250,000 by the NCUA
• No account opening or maintenance fees
• Expert IRA Specialist available
• Access to your account 24/7 with Advantages Online™ and the UECU Mobile Banking App
• Convenient payroll deduction

Choose the IRA that’s Right for You:

Traditional IRA

One of the key benefits to contributing to a Traditional IRA is the potential for a tax deduction up front. This option may make sense for you if you anticipate a higher tax rate while saving, anticipate a lower tax rate during retirement, are interested in taking the Required Minimum Distribution (RMD) amounts during retirement, or you are not concerned about tax savings for beneficiaries.

• Tax considerations: Contributions may be tax deductible; earnings are tax-deferred
• Eligibility: You (or your spouse if filing a joint tax return) must earn compensation from employment. For income limits, see IRS Publication 590 at irs.gov. Starting with the 2020 tax year, you may make a contribution at any age.
• Maximum yearly contribution: Up to $6,000 for 2020 and up to $6,000 for 2021 (plus $1,000 if you are age 50 or older)
• Contribution deadlines: You can contribute to your IRA until the due date for filing your federal income tax return for the year (for most individuals this is typically April 15th)
• Withdrawals: While you’ll get most out of a Traditional IRA at retirement, you can withdraw the money anytime, subject to income tax. An IRS penalty tax also may apply unless you are age 59 1/2 or older. Once you reach age 72–or age 70 1/2 in 2019 or earlier– you must start withdrawing at least a certain minimum amount each year to avoid penalty taxes.

Roth IRA

Unlike the Traditional IRA, contributions to a Roth IRA are never tax-deductible. But the money you contribute to your Roth IRA can be withdrawn tax-free at any time. And if you qualify, you can withdraw the earnings tax-free too. A Roth IRA may be more fitting if you anticipate a lower tax rate while saving, anticipate a higher tax rate during retirement, want to avoid RMDs, are concerned about tax savings for beneficiaries, or you are not eligible to contribute to a Traditional IRA because of the age limit.

• Tax considerations: Contributions are taxable and can be withdrawn tax and penalty-free at any time; earnings are tax-deferred; certain earnings withdrawals may be tax-free
• Eligibility: No age limit to contribute; however, the owner must be earning income . See income limits below.
• Income limits: For 2020, contributions begin phasing out at these Modified Adjusted Gross Incomes (MAGIs): $124,000 for single and head of household or $196,000 if married, filing jointly. For 2021, the Roth IRA income phase-out for determining maximum contribution for married joint filers rises to $198,000 to $208,000 (was $196,000 to $206,000). And, the Roth IRA income phase-out for determining maximum contribution for single filers and heads-of-households rises to $125,000 to $140,000 (was $124,000 to $139,000).
• Maximum yearly contribution: Up to $6,000 for 2020 and up to $6,000 for 2021 (plus $1,000 if you are age 50 or older)
• Contribution deadlines: You can contribute to your IRA until the due date for filing your federal income tax return for the year (for most individuals this is typically April 15th)
• Minimum Required Distributions (withdrawals): No withdrawal requirements

Advantages IRA Certificate of Deposit

For current rates, click here.

Coverdell Education Savings Account

For additional Information, click here.

Trying to find the right IRA option? Check out our digital brochures.

Your IRA Options

Roth IRAs

Traditional IRAs

Coverdell IRA’s

HSA’s

Ready to Get Started? Need Help? Have Questions?

Call our IRA Specialist, Jolynn Stuebner at 800.288.6423, ext. 4053 or contact her via email at  jstuebner@UECU.org

This information is not intended to provide tax advice. See a competent tax advisor to help you determine which type of IRA best suits your needs.