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Individual Retirement Accounts (IRAs)
Spending time with the grandkids, fishing out on Old Hickory Lake, traveling the world — these are just a few of the ways you could spend your retirement days with the help of an IRA. Choose from a traditional or Roth IRA plan to fit your lifestyle.
No matter the plan you choose, you’ll enjoy tax advantages and earn interest above standard savings rates. We’re here for our customers during every phase of life. Make your retirement years your best by preparing early with Volunteer State Bank.
- Summary
- Tax-advantaged retirement savings*
- Competitive interest above standard savings rates
- Traditional and Roth IRA options
- No setup fees
- No monthly or annual maintenance fees
- $5,000 contribution limit per year
- Additional $1,000 “catch-up” contribution allowed for ages 50+
- Funds can be used to purchase CDs within IRA
- $1,000 minimum deposit to open
*Consult a tax advisor.
- Traditional vs. Roth
There are advantages to both traditional and Roth IRAs. One of the biggest differences is the time at which you see the most advantage. A traditional IRA provides potential tax relief today, while a Roth IRA has the potential for the most tax benefit at time of retirement.
Traditional IRA
- No income limits to open
- No minimum contribution requirement
- Contributions are tax deductible on state and federal income tax*
- Earnings are tax deferred until withdrawal (when usually in lower tax bracket)
- Withdrawals can begin at age 59 1/2
- Early withdrawals subject to penalty**
- Mandatory withdrawals at age 70 1/2
Roth IRA
- Income limits to be eligible to open Roth IRA***
- Contributions are NOT tax deductible
- Earnings are 100% tax free at withdrawal*
- Principal contributions can be withdrawn without penalty*
- Withdrawals on interest can begin at age 59 1/2
- Early withdrawals on interest subject to penalty**
- No mandatory distribution age
- No age limit on making contributions as long as you have earned income
*Subject to some minimal conditions. Consult a tax advisor.
**Certain exceptions apply, such as healthcare, purchasing first home, etc.
***Consult a tax advisor.
- IRA Rollovers
If you're changing employers, an IRA Rollover makes sense. If you are retiring or changing jobs and anticipate withdrawing money from your employer's retirement plan, you can avoid withdrawal penalties by transferring your assets into an IRA or another qualified plan. You can ask your employer to arrange for a "direct rollover" of your money into a new IRA account with us, or you can do it yourself with an IRA-to-IRA rollover.
You must complete the rollover within 60 days from the date you receive the assets from your old IRA in order to qualify and not pay the mandatory 20% withholding and possibly other penalties as well. Effective January 1, 2015 you may make only one non taxable IRA to IRA rollover every 12 months, regardless of the number of IRAs you have. For more information about IRA Rollovers or opening a new IRA, just give us a call or stop into one of our branches.
