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Individual Retirement Accounts
Uncle Sam just made it easier to save for retirement!
Thanks to new tax laws governing IRA’s, you can now build your individual retirement account faster! Here are just two of the many positive changes made.
IRA account limits raised 50%!
This year you can contribute up to $3,000 to your IRA. This increased amount continues through 2004. Then, in 2005, the limit will increase to $4,000, and will increase again in 2008 to $5,000.
Are you 50 or better?
Your contribution is raised by 75%!
This year you can take advantage of the “catch up” provision that lets you contribute up to $3,500! And it gets better…This annual “catch up” provision continues annually through 2005, then increases to $1,000 in 2006 through 2010.
These increased limits can make a significant difference on your retirement, and are effective for both Traditional and Roth IRAs.
We’re ready to help you open or add to your IRA today. Stop by any location of Hopewell Valley Community Bank. For information call
(609) 466-2900.
ROTH IRA
The Roth IRA is an exciting new way to invest in your future where you can watch your investment grow tax-free! In addition to tax-free investment growth, the Roth IRA offers:
- More flexible withdrawal options—for a new home, college, or special situations.
- Tax-free withdrawals for qualified distributions upon meeting a five-year holding period.
- Individuals are eligible to contribute if their Adjusted Gross Income (AGI) is less than $110,000 (single) or $160,000 (married).
- Individuals may continue to contribute after reaching 70 ½, and there are no required minimum distributions, so you can continue to earn interest tax-deferred until you need to withdraw your funds.
- Qualified individuals may make nondeductible contributions of $3,000 per year or 100% of their earned income, whichever is less.
- Qualified married couples may each contribute $3,000 per year assuming one of them has earned income exceeding $6,000.
- There is an aggregate contribution limit of $3,000 per tax year between Traditional and Roth IRAs
- The Roth IRA allows funds to accumulate tax-deferred even though your contributions are not tax deductible.
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REGULAR IRA
Individual Retirement Accounts remain one of your best tax-sheltered investments. Many people still qualify for a full tax deduction for their IRA contributions. For those individuals who don’t, all IRA accounts continue to earn interest on a tax deferred basis! Combining those tax-deferred earnings with compounded interest gives you rapid growth in the value of your IRA. Starting your IRA now will provide you with extra security and peace of mind for the future.
- You are eligible to contribute to an IRA if you have earned income.
- Contributions may not be made for or after the year in which you reach age 70 ½. Then, the law requires that you must begin to withdraw funds.
- In the event of disability or death, benefits can begin immediately, free of penalties, regardless of age.*
- You may be eligible to deduct 100% of your IRA contribution.
- Qualified individuals may make contributions of $3,000 per year or 100% of their earned income, whichever is less.
- Qualified married couples may each contribute $3,000 per year assuming one of them has earned income exceeding $6,000.
- There is an aggregate contribution limit of $3,000 per tax year between Traditional and Roth IRAs
- While it’s important to contribute the upper limit each year to maximize your earnings, there may be years when it’s just not possible. You are not required to contribute every year, and there is no minimum amount required for contributions.
- Every time you contribute to your Hopewell Valley Community Bank IRA, you save money because your earnings will not be taxed until you retire. Even then, you will be taxed on only the amount you withdraw each year. The remainder will continue to earn tax-deferred interest.
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IRA CDs
Available for individuals seeking to fund their IRA account with fixed term FDIC insured savings, ranging in terms from 3 to 36 months.
- Higher yielding investments at a guaranteed interest rate.
- Minimum as low as $500 to open an account
- Interest is compounded daily and credited monthly.
- Automatically renewable at maturity
- You can add money to your account at any time prior to maturity so you can maximize your return.
- Plus, we make it easy to transfer your current IRA to Hopewell Valley Community Bank, without IRS penalty.
*There are IRS penalties for withdrawal before the age of 59 ½.
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