Individual Retirement Accounts

IRAs are one of the best savings tools available today. More people than ever before are now eligible to benefit from the tax advantages provided through IRA investments.

Lancaster Red Rose Credit Union offers three types of IRAs: Traditional, Roth and Coverdell Education Savings Accounts.

Traditional IRA
This IRA allows up to $4,000 in tax-deductible contributions. Anyone under age 70 who has earned income, or is filing jointly with a spouse, who has earned income, may contribute. In addition, a $1000 annual catch-up contribution may apply to those individuals who attain age 50 before the end of the taxable year.

Roth IRA
Roth IRA contributions are not tax deductible. However, all withdrawals, including earnings, are generally tax free if the account has been open for at least five years and the account holder is 59 ½ or older.

Coverdell Education Savings Account
This account allows you to save for elementary and secondary education, in addition to higher education expenses, by investing up to $2,000 per year per child under the age of 18. Contributions are not tax deductible, but earnings grow tax free.

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You may choose either an IRA Share Account or IRA Share Certificate. Both offer competitive rates and no annual maintenance fees. IRAs with Lancaster Red Rose Credit Union are federally insured up to $250,000 separately from your other accounts by the NCUA.
 

Be sure to consult your tax advisor regarding the advantages, disadvantages and limitations of various IRAs as they relate to your tax situation.