Roth & Traditional IRA

Coweta Cities & Co. EFCU offers a share savings IRA that pays the same quarterly interest rate as the highest tier of the share savings accounts. The minimum to open is $50.00. The same rate and terms apply for both the Roth and Traditional IRA.

We do not offer the Coverdell Education Savings Account.

The remainder of the Individual Retirement Accounts information is correct.

Individual retirement accounts are a smart way to save for the future. A traditional IRA can be opened and funded without any employer participation. Contributions and/or earnings are tax-deferred until retirement. Unlike many employer plans, money in the account is always accessible; however, until age 59 1/2 there is a 10 percent early distribution penalty unless you qualify for an exemption due to one of the following: disability, qualifying education expenses, unemployment, qualifying first-home purchases, death, or receipt of your IRA assets in equal payments over your life expectancy.

Members under age 70 1/2 may contribute to an IRA at a maximum of $3,000 per year for tax years 2002 - 2004.

Roth IRA

Roth IRAs differ from Traditional IRAs in that the money you contribute to a Roth IRA has already been taxed. So the principal amount is never subject to taxes or penalties in the future, as long as you stay within the contribution guidelines. This retirement plan allows the money you contribute to grow tax-deferred.

If you do not withdraw any of the earnings until you have had the plan for at least five years, or satisfy one of the qualifying events, those tax-deferred earnings become tax-free. Unlike the traditional IRA, there is no 70 1/2 age limit on making contributions. You simply need to have earned income equal to the amount you contribute up to a maximum of $3,000 per year for tax years 2002 - 2004.

Click here for current rates or click here for the retirement calculator.

* The Credit Union provides no legal advice to members, and provides the foregoing information from a reliable resource to give our members a basic understanding of these services. You should consult with your tax or legal adviser regarding any particular and the current status of applicable federal and state laws.

For more information on Roth & traditional IRA accounts, please contact us.