A credit union IRA can benefit you in may ways:

 

*You enjoy the friendly, personal services that credit unions are known for.

*Credit unions generally pay higher rates on IRAs and charge lower fees, if any.

*You'll have easy access to your account and answers to your IRA questions from our knowledgeable staff.

*Your deposits will be safe and secure because they are insured.

 

Choose the IRA that fits your situation.

 

The Taxpayer Relief Act of 1997 was designed to provide investors with tax breaks and create a greater incentive to save.  Not only did it improve the traditional IRA, but it also introduced the Roth IRA.  These options were improved by the Economic Growth and Tax Relief Reconciliation Act of 2001.

 

The Roth IRA is funded with after-tax dollars:

 

*You may withdraw your contributions tax-free and penalty-free at any time.

*Earnings may be withdrawn tax-free and penalty-free under a variety of conditions.

*Funds may be used for a first-time home purchase (lifetime limit is $10,000 per person).

*You don't have to receive required minimum distributions (after age 70 1/2 ).

*There is no maximum age limit for making contributions.

* You can contribute to an IRA even if you contribute to an employer-sponsored plan

*You may convert your existing Traditional IRA to a Roth IRA (some restrictions apply)

 

The traditional IRA is funded with pre-tax dollars:

 

* Income limits, which are used to determine tax deductibility, have been increased, so more people can deduct their contributions.

*Taxes on your earnings are deferred until the year you with draw them from your account, potentially being taxed at a lower rate.

*Tax-deferred compounding of earnings can reduce your current tax bill.

*Qualified distributions are penalty-free for the first-home purchases and higher-education expenses.

*Rolling over a distribution from a qualified retirement plan into a traditional IRA avoids mandatory 20% federal income tax withholding and retains the tax-deferred status of the amount you rollover.

 

Coverdell Education Savings Account

 

* Coverdell ESA offers you the potential for tax-free withdrawals - including earnings.

*Nondeductible contributions of $2,000 per year if eligible.

*Contributions can be made until the child is 18 years of age, and must be used by age 30.

*Anybody who meets the income requirements can open and contribute to your child's Coverdell ESA.

*Use for qualified expenses such as tuition, fees, books and equipment required for enrollment or attendance at nearly any post-secondary educational institution (public, nonprofit or proprietary) qualified expenses also include these same expenses for elementary and secondary education and the purchase of computer technology or equipment that is used by the beneficiary and the beneficiary's family while the beneficiary is in school.

*Contributions to a Roth or Traditional IRAs have no effect on the contribution you can make to each Coverdell ESA.

*The deadline for making a Coverdell ESA contribution is the tax return deadline for the year which the contribution is being made.  (Usually April 15th of the following calendar year)

*If funds are not used by the child they can be transferred to another Coverdell ESA or another child in your family.