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:

  • 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

You may receive an up-front tax deduction of up to $5,500 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.

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
2017 Maximum Annual Contribution
$5,500.00 $5,500.00
(A maximum of $5,500.00 can be contributed to a Traditional IRA or Roth IRA or split between both.)
2017 Non-Wage-Earning Spousal Contribution
$5,500.00 $5,500.00
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Grow tax-deferred until withdrawn Grow tax-deferred
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 59. 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 Contributions and earnings are tax-free when withdrawn to pay for qualified education expenses.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.