Individual Retirement Accounts (IRAs)

• Competitive dividends above standard savings rates
• Traditional and Roth IRA and Coverdell ESA options available
• No setup fees
• Contribution limits may adjust annually
• Additional $1,000 "catch-up" contribution allowed for ages 50+
• Funds can be used to purchase eDCU IRA CDs
• $250 minimum deposit to open
• Federally insured to $250,000 by NCUA

*Consult a tax advisor.

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

• Must have earned income and will not reach age 70½ by the end of the year to open
• No minimum contribution requirement
• Contributions are tax deductible on state and federal income tax¹
• Earnings are tax deferred until withdrawal (when usually in lower tax bracket)
• Withdrawals can begin at age 59½
• Early withdrawals subject to penalty²
• Mandatory withdrawals at age 70½

Roth IRA

• Income limits to be eligible to open Roth IRA3
• Contributions are NOT tax deductible
• Earnings are 100% tax free at withdrawal¹
• Principal contributions can be withdrawn without penalty¹
• Withdrawals on interest can begin at age 59½
• Early withdrawals on interest subject to penalty²
• No mandatory distribution age
• No age limit on making contributions as long as you have earned income

¹Subject to some minimal conditions. Consult a tax advisor.

²Certain exceptions apply, such as healthcare, purchasing first home, etc.

³Consult a tax advisor.

College can be a time for growth and learning. Unfortunately, building debt is often part of that equation too. But establishing a Coverdell Education Savings Account (formerly called an Education IRA) for a beneficiary is a great way to help avoid that last part.

• Set aside funds for your child's education
• Dividends grow tax-free
• Withdrawals are tax-free and penalty-free when used for qualified education expenses¹
• Designated beneficiary must be under 18 when contributions are made
• To contribute to an ESA, certain income limits apply²
• Contributions are not tax deductible
• $2,000 maximum annual contribution per child
• The money must be withdrawn by the time he or she turns 30³
• The ESA may be transferred without penalty to another member of the family
• $250 minimum deposit to open

¹Qualified expenses include tuition and fees, books, supplies, board, etc.

²Consult your tax advisor to determine your contribution limit.

³Those earnings are subject to income tax and a 10% penalty.