Individual Retirement Account (IRA)

Individual Retirement Accounts (IRAs) are savings accounts designed to help wage earners save for retirement. Many members may still be eligible to deduct their IRA contributions from their taxable income. For them, the Traditional IRA is a great investment.

For those who might not take the deduction, the Roth IRA allows you to make IRA contributions with possible tax-free benefits. Because IRA earnings are sheltered from taxes, IRAs grow faster than ordinary savings accounts. There is no minimum deposit required for an IRA at St. Cloud Federal Credit Union. NCUA deposit insurance on IRA accounts is $250,000 per account.

Remember, you can have a Traditional or Roth IRA, or both.Within your IRA, you can diversify your investment by selecting one or both of the investment options described below — Money Market or Certificate.

St Cloud Federal offers the following types of IRAs:

Traditional IRA & Roth IRA

Features & Benefits of All

  • No Minimum Balance.
  • Two Investment Options (See details below).
  • Dividend Figured Daily And Paid Monthly.
  • Helps You Save For Retirement.
  • Dividends Earned Are Tax-Deferred.

Traditional IRA

  • Retirement Savings that yields higher interest and possible deductible contributions.
  • The annual contribution limit for someone under age 50 is $5,000 for 2011. The annual contribution limit for someone age 50 or older is $6,000 for 2011.
  • May elect distributions at age 59-1/2 without IRS penalty.
  • Can use IRA funds if re-deposited within 60 days.
  • Can roll Qualified Pension Plan into a Traditional IRA and avoid paying taxes.

Roth IRA

  • Retirement Savings that yields higher interest, non-deductible contributions, and possible tax free benefits.
  • The annual contribution limit for someone under age 50 is $5,000 for 2011. The annual contribution limit for someone age 50 or older is $6,000 for 2011.
  • You can withdraw contributions anytime, tax free and penalty free.
  • Huge tax Savings – Tax-free qualified distributions after 5 years.
  • You are not required to take distributions at age 70-1/2.

IRA Investment Options to help you diversify your Traditional or Roth IRA:

1. IRA Money Market

  • A liquid account in which money may be added or withdrawn any time without any penalty from the Credit Union. However, there may be an IRS early withdrawal penalty.
  • Many members use this as a holding account if they may need the funds in the near future, or if they wish to combine two or more CDs maturing at different dates.
  • Also an excellent choice for members using payroll deduction for their IRA, or those with less than $500 in their IRA.

2. IRA Certificates

  • An investment in which your funds are deposited for a certain time period at a particular fixed rate.
  • Minimum deposit required is $500.
  • Withdrawal of funds before a certificate matures involves a Credit Union interest penalty (See Rate Sheet for details).
  • This account is a great choice for members looking for a safe, no-risk investment of their IRA funds.

How to Become a Member and Open Your IRA Account.

Come by the Credit Union office to sign the Signature Card.
If you are not a current member, make a separate one-time deposit of $10.00 (A $10 minimum balance must be maintained at all times in a regular savings account, in order to maintain active membership).

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