Credit Life 2

How IRAs Help You Retire On Your Own Terms

When should you start and what's the best option?

The average American between the ages of 35 and 44 has just over $22,000 dollars saved for retirement. For people who are entering their prime earning years, this is far too low. If you want to retire at age 65 and live on $50,000 a year, you’ll need about 15 times that much, assuming you live to the average age of 72. For most Americans, retirement seems like an always-distant horizon. They can always see it, but they never quite have enough money to reach it. As a result, they end up working long into their 70s.

There is a way you can save more for retirement, while also saving on your tax bill and earning interest on your investment. It’s called an Individual Retirement Account (IRA). It’s a managed investment account, like a mutual fund, that will grow your wealth so you can enjoy your retirement.

If you work for a large company, you may have something like an IRA: a SIMPLE IRA (Savings Incentive Match Plan for Employees) or a 401(k). Even if you’re maximizing your contributions to these programs, you can still use an IRA from your credit union. The extra money you save in an IRA can pay for the things you’ve always wanted to do. You can spend your retirement traveling the world or going back to school. All you have to do is start planning now.

Successful investing in an IRA is more about starting early. If, at age 18 you deposit $5,000 into an IRA and it earns 8% per year, you will retire with $164,000 dollars, assuming you make no other savings. Doing the same thing at age 39 will build a nest egg of a mere $40,000. The key to successful retirement savings, then, is good and early planning.

The deadline for contributions to count against your tax burden is traditionally on tax day, around April 15th. The time to start investing in a brighter retirement future is now. Let’s take a look at some benefits of investing in an IRA:

IRAs come in two forms: Traditional and Roth. A Traditional IRA is tax-deferred. You don’t pay taxes on the money you put into a Traditional IRA. Instead, you pay taxes on your withdrawals. If you’ll have less income after you retire, a Traditional IRA can save you money on your tax bill.

You fund a Roth IRA with post-tax assets. You invest in a Roth IRA with your post-tax salary. Then, you don’t have to pay taxes on the withdrawal. Roth IRAs make the most sense for people who expect to draw a significant post-retirement income. If you expect to have a significant pension or plan to start a profitable small business when you retire, a Roth IRA might be best for you.

The best part about retirement savings with an IRA is that it requires little direct management. You can set up direct deposit from your paycheck to your IRA, allowing you to grow your savings over time. You’ll receive a monthly statement, just like you do from your checking account. It will show you how much your investments have grown.

IRAs are also professionally managed. A full-time financial analyst directs the growth of the fund. Your retirement savings are in the hands of a professional who knows the ins and outs of the market and can make your money work for you. Rates of return on IRA’s tend to be higher than CDs or savings accounts. This higher return can make sure you have enough money saved to enjoy your retirement.

IRAs offer some flexibility. Withdrawals before retirement incur a tax penalty and other fees, but the money in an IRA is accessible in the case of emergency. You can also change the size of your contribution month-to-month. This flexibility means you can take advantage of sudden windfalls or expenses.

IRAs are large, managed funds. They can take advantage of economies of scale that are unavailable to individual investors. Managers working with more capital can make safer investments while maintaining good returns. Trying to manage your own retirement investments limits you to working with just the money you have. Investing in an IRA at your credit union allows you to use the added savings power of your entire community.

Relying on Social Security or other guaranteed income for your retirement is not a good idea. The demands that are placed on these programs keep going up and contributions to them keep going down. It doesn’t take a professional financial analyst to see that these trends can’t go on forever. Take charge of your financial future, and do it now. Make an appointment with the helpful professionals at Listerhill Financial Services and start taking charge of your financial future!

default icon for Solution Finder Intro
What can we help you with?
default icon for Checking For Mature Members
What are you borrowing for?
default icon for Checking For Mature Members
Vehicle Options
default icon for Checking For Mature Members
Home Options
default icon for Carrolls
What are you saving for?
default icon for Carrolls
How old are your kids?
default icon for Cord
Which of these banking options are you interested in?
default icon for Cord
How old are you (or your child)?
default icon for Cord
Are you a UNA student?
default icon for Cord
What do you want to do?
default icon for Cord
What do you want to do?
default icon for Cord
What do you want to do?
default icon for Cord
What do you want to do?
default icon for Cord
How old are you?
search popup background

What are you looking for?

Common Links

Frequently Asked Questions

  • Maintenance Fee

    New Fee:Details:
    Maintenance Fee We are introducing a new $5/month Maintenance Fee to all members. However, this fee can be waived if you meet just one of the following criteria: 

     • You or someone in your household has had a current loan or mortgage within the last 12 months. 
     • You or someone in your household has an open credit card 
     • You or someone in your household has an aggregate average daily balance of $3,000 in your accounts
     • You or someone in your household has a relationship with our Listerhill Financial Services department 
     • You have paid at least $125 in NSF, Transfer, or Courtesy Pay fees for the month 
     • You are under the age of 25 
     • Your account is less than 90 days old 
     • You have paid a Return Mail Fee or an Inactive Account Fee for the month
  • Jumbo Certificates Early Withdrawal Penalty

    Existing Fee:Changing To:

    Jumbo Certificates Early Withdrawal Penalty

    • Terms of 1 year or less: 30 days interest

    • Terms of over 1 year: 90 days interest

    Monthly Certificate Early Withdrawal Penalty

    • Terms of 1 year or less: 90 days interest

    • Terms of 18 mos-2 yrs: 180 days interest

    • Terms of over 2 years: 210 days interest

  • Regular Certificates Early Withdrawal Penalty

    Existing Fee:Changing To:
    Regular Certificates Early Withdrawal Penalty

     • Terms of 1 year or less: 30 days interest 
      
     • Terms of over 1 year: 90 days interest
    Quarterly Certificate Early Withdrawal Penalty 

     • Terms of 1 year or less: 90 days interest 

     • Terms of 18 mos-2yrs: 180 days interest 

     • Terms of over 2 years: 210 days interest
  • Relationship Fee

    Existing Fee:Changing To:
    Relationship Fee This fee is being eliminated. If you currently pay the $10/month Relationship Fee, you will no longer be charged this fee.
  • 60 or 72 Month Jumbo Certificate

    Existing Account:Changing To:What This Means:
    Jumbo Certificates 
    (60 month and 72 month)
    Monthly Certificate 
    (60 month)
    Certificates will now be offered in six terms instead of ten terms and a reduced minimum opening deposit of $500 is required. However, you will continue to receive the following benefits: 
     • Interest Paid Monthly 
     • Interest Paid by Deposit to Affiliate Account (Early withdrawal penalties have changed. Please see chart below.)