Individual Retirement Account Individual Retirement Accounts (IRAs) are one of the most viable answers to the question of how to assure a secure retirement. BFGFCU offers members a variety of IRA options. You may open: Contributory Account with a low minimum deposit IRA Share Certificate account with as little as $500 for terms of 6 to 60 months IRA Rollovers in any amount are always welcome BFGFCU offers Traditional IRAs, Roth IRAs and Educational IRAs. All dividends on IRAs are tax-deferred. All IRAs at BFGFCU are federally insured up to $250,000. Traditional IRA Effective 2008 with a Traditional IRA, you may receive an up-front tax deduction of up to $5,000 on annual contributions. Roth IRA The Roth IRA gives you the ability to invest your after-tax dollars today and let the investment grow tax-deferred. If you do not withdraw any of the earnings until you have had the plan for at least 5 years those tax-deferred earnings become tax-free. Traditional and Roth IRA Comparison Chart Traditional Roth IRA Who Can Contribute Individuals under the age of 70½ and have earned income from employment Individuals of any age who have earned income from employment 2008 Maximum Annual Contribution $5,000.00                                       $5,000.00 (A maximum of $5,000.00 can be contributed to a Traditional IRA or Roth IRA or split between both.) 2008 Non-Wage-Earning Spousal Contribution $5,000.00 $5,000.00 Tax Deductibility of Contributions Up to 100% depending on annual gross income and participation in an employer-sponsored pension plan Cannot deduct Tax Treatment of Dividend Earnings Grow tax-deferred until withdrawn Grow tax-free Taxes Upon Withdrawal Withdrawals of contributions and dividend earnings are taxed as ordinary income at the then current tax bracket None Withdrawal Restrictions Currently, most withdrawals before age 59½ result in IRS penalties. Some exceptions are made for catastrophic medical expenses or disability. The new law allows for early penalty-free withdrawal for first-time home purchases and/or college expenses. IRS penalty-free withdrawal after the plan has been open for 5 years and after the age of 59½. Penalty-free and tax-free withdrawals prior to age 59½ if the funds are used for disability or first-time home purchase. Education IRA An Education IRA is an investment tool that lets members pay for the future cost of a child’s post-secondary education. The plan permits after-tax contributions of $2,000 per year for each child until they reach age 18. Contributions and earnings are tax-free when withdrawn to pay for qualified education expenses. Consult your tax advisor for your specific qualifications. For additional information about BFGFCU’s IRA accounts, call one of our IRA Specialists at 800-306-4400 ext. 4126.      We Do Business in Accordance With the Federal Fair Housing Law and the Equal Credit Opportunity Act. Current Deposit Rates  Share Accounts  Checking Accounts  Money Market Savings Account   Share Certificate Accounts  Individual Retirement Accounts  Site Map Return to BFGFCU Home