Enriching Your Golden Years
An Individual Retirement Account (IRA) is the blanket term for a form of retirement planning that provides tax advantages for retirement savings in the United States.
Many people mistakenly believe that IRAs are available only through an employer or a financial service that specializes in IRA plans. This is not true! American Bank offers IRA plans that can be opened with as little as $100.00. The funds can then be moved to higher-earning IRA options as the balance grows.
In these uncertain economic times, it's comforting to know your hometown community bank can be your partner in setting aside some funds for retirement!
History of an Individual Retirement Account
Individual retirement accounts were introduced in 1974 with the enactment of the Employee Retirement Income Security Act. Taxpayers could contribute up to $1,500.00 per year and reduce their taxable income by the amount of their contributions. In 1981, the Economic Recovery Act expanded availability of IRAs, and the maximum allowable contribution was raised to $2,000.00.
Maximum allowable contributions have continued to rise and now stand at $5,500.00 per year for individuals under 50 years of age and $6,500.00 per year for those 50 and older.
Individual Retirement Account (IRA) funds cannot be distributed before the age of 59½ without a penalty, unless special circumstances are present.
Individual Retirement Account (IRA) FAQs
What type of IRAs does American Bank offer?
At American Bank, we offer the following types of Individual Retirement Accounts (IRAs):
- Traditional IRAs
- Roth IRAs
- SEP
- Simple IRAs
We also offer Education Savings Accounts which are tax advantaged accounts used for education expenses.
How do I make a contribution to my IRA?
You can make contributions to your IRA through one of the following methods:
- deposited at one of our locations
- mail a check to us
- sent to electronically via an Automated Clearing House (ACH) file (direct deposit or electronic transfer)
When making a deposit by mail please make sure to include whether you want the contribution made for the current tax year or prior tax year (if being sent in between January 1 to April 15).
Contributions can be made for the prior tax year up to April 15 (or the adjusted tax filing deadline for individuals).
Can I add a beneficiary to my IRA?
Yes, as part of the account opening process for an Individual Retirement Account (IRA) you will be asked to name a beneficiary to receive the funds upon your death. You may name multiple beneficiaries and you may choose what percentage of the account each beneficiary will receive. You are also able to name contingent beneficiaries. Contingent beneficiaries receive the funds in the account if ALL of your primary beneficiaries pre-decease you.
Open an Individual Retirement Account (IRA)
Call or visit a personal bank today!