Individual Retirement Accounts: Better Than Ever
Individual Retirement Accounts (IRA) create value for you to save for your retirement years and for funding education expenses.

Please call 1st BankSM for more information on Individual Retirement Accounts.

Traditional IRA

  • Must have earned income and not reach age 70 ½ by end of year
  • Annual IRA contributions: $5,500 in 2013
  • Annual limit applies to any combination of IRA plans
  • Contributions are fully tax-deductible if you are not an active participant in an employer retirement plan
  • Contributions up to the limit are fully tax deductible if you are not an active participant in a retirement plan, otherwise phase-out rules apply.
  • Investments grow on a tax-deferred basis
  • Earnings are taxed only upon withdrawal
  • Opportunity for early withdrawal - Ask us about special circumstances

Roth IRA

  • Contribute to a Roth IRA even after age 70 ½, with earned income
  • Contributions will not be tax deductible, but the contributions and earnings can be withdrawn tax-free.
  • Same contribution limits as Traditional IRA listed above.
  • No required minimum distributions after reaching age 70 ½.
  • Convert your traditional IRA to a Roth IRA, to take withdrawals tax-free, but is subject to income tax now.
  • Opportunity for early withdrawal - Ask us about special circumstances

Catch-up Contributions

  • If you have reached age 50, make additional $1,000 catch-up contributions per year to a Traditional or Roth IRA

Coverdell Education Savings Account (ESA)

  • The Coverdell ESA (formerly known a an Education IRA) is a great way to start saving for any level of education, from elementary school through graduate school.
  • ESAs allow eligible parents, family members and students to contribute up to $2,000 per year (until the child turns age 18) toward qualified education expenses at any college, university, vocational, elementary, or secondary school.
  • With an ESA, participants can benefit from tax-defered growth and tax-free withdrawals when the proceeeds are used for qualified education expenses.