HomeTown helps towards financial freedom.
Individual Retirement Accounts
Save towards your dreams of a comfortable retirement.
With an IRA, or Individual Retirement Account, from HomeTown Credit Union, we can provide you with the knowledge you need to make the right IRA choices for you.
What is an IRA?
An Individual Retirement Account is an investment account that lets you save money for retirement through yearly contributions while offering tax advantages. They’re also protected and insured up to $250,000 by NCUA.
What IRAs We Offer:
Traditional IRA
Traditional IRAs are taxed at withdrawal, but allow tax deductions on the contributions you make. This type of IRA requires that you begin withdrawing funds at 70 ½ years of age.
Roth IRA
A Roth IRA allows you to enjoy tax-free growth over the years but provides no tax breaks on your contributions. Your contributions are also dependent on the modified adjusted gross income limits. However, Roth’s don’t have withdrawal age requirements.
Compare Them
| IRA Basics |
Traditional IRA |
Roth IRA |
| Contributions |
Up to $6,000 per year. Up to $7,000 for age 50 and older. |
Up to $6,000 per year. Up to $7,000 for age 50 and older. *Subject to modified adjusted gross income limits. |
| Maximum Contributions age limit |
Age 70 ½ |
None |
| Taxation |
Earnings taxed at withdrawal. Contributions may be tax deductible. Check with a tax advisor. |
Contributions subject to taxation. Earnings grow tax-free. |
| Withdrawals |
Optional beginning at age 59 ½. Mandatory at age 70 ½. |
Optional beginning at age 59 ½. No mandatory withdrawal age. |
| Early Withdrawal |
Penalties apply; exceptions exist for the first time home purchase, higher education expenses, or if disabled. Consult a tax advisor for details. |
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Coverdell Education Savings Accounts
College is expensive—but you can be ready. A Coverdell Education Savings Account makes it easy to plan, through yearly contributions, for your child or grandchild’s future education expenses.
- $2,000 yearly contribution maximum
- Earns dividends based on tiered structure that are compounded monthly
- Tax-free withdrawals
- Tax-free growth
- No penalties at withdrawal
- Beneficiary must be 30 years or younger at withdrawal