The Traditional IRA

Online Banking and Your Traditional IRA

A Traditional IRA, offers tax-deferred growth. This means that you will not pay taxes on the interest and earnings in your Traditional IRA until you withdraw them. And, depending upon your income level, a Traditional IRA contribution may be tax deductible to boot! Plus, thanks to online banking, opening a Traditional IRA has never been easier.

Traditional IRA Eligibility

A Traditional IRA is an excellent way to supplement your individual retirement income. Contributions are flexible, so you can choose when you want to fund your Traditional IRA. Eligibility requirements for contributing to a Traditional IRA do vary. The general rules are:

• You have received taxable compensation during the year
• You are under 70 ½
• Non-working spouse or those with limited compensation can contribute to a spousal IRA

The annual contribution to a Traditional IRA does vary and you should contact your tax advisor for exact contribution limits. If you are in an employee funded 401K different rules do apply to Traditional IRA eligibility and contributions.

Required Minimum Distributions for a Traditional IRA

Required minimum distributions, also known as RMDs must usually be made by April 1st of the year following the year you reach age 70 ½. RMDs made after that age must be made by December 31st.

The minimum amount required for Traditional IRA distribution is determined by a number of factors which your tax advisor can help you determine or you can see IRS Publication 590 for an explanation. It is also important to note that Traditional IRA distributions can exceed those of your required minimum distribution.

Advantages of a Traditional IRA and Online Banking

The advantages of online banking in general are well understood. Many of these same online banking benefits apply to your Traditional IRA as well. Among the strongest reasons to open your Traditional IRA through your online banking institution is the ease of making annual, monthly or quarterly contributions. Often these contributions can be set up to be immediately withdrawn from another account in set amounts, at pre-determined time periods. Additional advantages of your Traditional IRA through Internet banking channels are:

• 24/7 access to Traditional IRA
• Easy tracking of contributions
• Ability to change IRA investments within a plan
• Transfer contributions and distributions to other accounts

There's nothing standard when it comes to the benefits of a Traditional IRA. The time to start saving for your retirement is today. For information on getting started go to iGObanking.com.

* This information is not intended as tax or legal advice. Please consult with your tax advisor or attorney regarding your individual situation.

It's easy to sign up for online banking. Go to iGObanking.com, member FDIC, to begin your Internet banking today or call us at 1-888-432-5890.