Checking and savings —
Traditional & Roth IRAs
An individual retirement arrangement (IRA) can help you save for retirement with either tax deferred or tax-free growth of any earnings.
There are two main types of IRAs – Traditional or Roth. You can choose one or both depending on your tax situation and income. If you have just changed jobs or recently retired, you can roll your money into a Traditional IRA or Roth IRA. Gesa can help you take control of your retirement assets and preserve your tax advantages.
A Gesa representative can show you options available for your financial future.
|Comparison||Traditional IRA||Roth IRA|
|Earnings||Earnings are tax-deferred until withdrawn (IRS early withdrawal penalties may apply if you are under age 59 1/2).||Earnings are tax-deferred and tax-free upon withdrawal if certain requirements are met.|
|Contributions||You may no longer make contributions for the year in which you reach age 70 1/2; or in later years.||You may contribute as long as you have earned income for the tax year in which you designate your contribution and your MAGI* does not exceed certain limits.
*modified adjusted gross income
|Deductibility||Contributions may be tax-deductible based on income levels & tax filing status.||Contributions are not tax-deductible.|
|Income requirements: For Contributions||No income limit to make contributions; however, you must have earned income to contribute.||Your modified adjusted gross income must be below certain limits depending on your tax filing status.|
|Distributions||Distributions are required beginning at age 70 1/2.||You are not required to take mandatory distributions at any age during your lifetime. Beneficiaries are subject to minimum distributions rules, but may not have to take a distribution in a specific year.|
Should you convert to a Roth IRA?
Anyone can convert their Traditional IRA, or rollover eligible employer retirement plans, to a Roth IRA.
The decision to convert your Traditional IRA or rollover your eligible employer retirement plan to a Roth IRA is a complex one. Below are some key factors that can help you determine whether you would be a good candidate. For additional help, please contact your financial advisor or find a financial advisor near you.
|Conversion to a Roth IRA may be appropriate if:||Leaving assets in a traditional IRA or employer plan may be appropriate if:|
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Notes & Fees Glossary
|*APY||* APY = Annual Percentage Yield. Rates, terms, and fees are subject to change. APY is accurate as of the first day of the month – the last dividend declaration date.|
|SmartPlus Checking||*To earn the higher rate, you must: