FAQs (data-driven)

Individual Retirement Account

• What is an Individual Retirement Account (IRA)?

  An Individual Retirement Account is a retirement savings account that offers tax-deferred or tax-free benefits to help members save for retirement.

• What is the difference between a Traditional IRA and a Roth IRA?

  A Traditional IRA allows eligible contributions to grow tax-deferred until withdrawal, while a Roth IRA offers tax-free qualifies withdrawals because contributions are made with after-tax income.

• How does a Traditional IRA work?

  Traditional IRA contributions may be tax deductible, and dividends grow tax-deferred until funds are withdrawn during retirement.

• How does a Roth IRA work?

  Roth IRA contributions are mad with after-tax income, allowing qualified withdrawals to be tax free after meeting eligibility requirements.

• Can I contribute to an IRA after age 70 ½?

  Yes. There is no age limit for making regular contributions to Traditional or Roth IRAs for eligible members.

• Are IRA withdrawals taxed?

  Traditional IRA withdrawals are generally taxable. Qualified Roth IRA withdrawals may be tax free.

• When can I withdraw money from my IRA without penalties?

  In many cases, IRA withdrawals made before age 59 ½ may be subject to taxes and early withdrawal penalties unless an IRS exception applies.

• What is the difference between tax-deferred and tax-free retirement savings?

  Tax-deferred savings delay taxes until withdrawal, while tax-free savings allow qualified withdrawals without federal income taxes.

• Is an IRA good for retirement planning?

  IRAs are designed to help members save for retirement with potential tax advantages and long-term savings growth.

• Can you help me choose the right IRA?

  [[companyShortname}} offers free retirement planning guidance from financial professionals to help members compare IRA options and retirement goals.