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Listerhill Credit Union is a nonprofit financial cooperative improving lives in our community.

If you live in Alabama, Georgia, Mississippi, Florida, or Tennessee, you are eligible to become a member. Depending on your individual eligibility, we may require membership into an approved association at no cost to you.

You can also qualify for membership by being a family member of a current or potential Listerhill member.

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Retirement

A Full Guide to Saving for Retirement with an IRA

Learn more about how you can save more for retirement, while also saving on your tax bill and earning interest on your investment.

Editorial Note: Articles published are intended to provide general information and educational content related to personal finance, banking, and credit union services. While we strive to ensure the accuracy and reliability of the information presented, it should not be considered as financial advice and may be revised as needed.

The average American between the ages of 35 and 44 has just over $22,000 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.

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, 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 tax day. 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. Learn more about the IRAs we offer or visit your closest Listerhill branch to talk to a Member Advocate about how you can open one.

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Frequently Asked Questions

  • How can I avoid overdraft fees?

    All Listerhill checking accounts are eligible for 3 Overdraft or NSF Fee refunds per year. To request a refund, visit a Listerhill branch or call 1-800-239-6033.

    Additionally, we provide our members with overdraf services like:

    • Standard Overdraft Coverage

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  • Do I have to pay any monthly service fees for having a checking account at Listerhill?

    Our Everyday Checking account comes with no minimum balances and no monthly service fees, so if you choose this account, you won’t have to pay any monthly fees, no matter what your daily balances are.

    If you’re interested in Growth Checking, you’ll have to pay a $10 monthly fee is your average balance is below $1,000. You can easily waive the account fee by keeping $1,000 or more in your account. That way, you can earn interest on your deposits without paying any monthly maintenance fees. It’s a win-win!

  • Why should I open a Growth Checking account?

    Growth Checking is the perfect account for those who want to see their money grow faster. This account offers high returns on your deposits for a small monthly service fee. You can waive the monthly fee by keeping $1,000 or more in your account. What’s even better is that the more you keep in your account, the higher the interest rate you’ll earn, so it makes sense to keep higher balances in your Growth Checking!

    If you want to put your money to work for you, open a Growth Checking account. Simply click here to start your online application as a new member or log into online or mobile banking to open your checking account if you’re already an established member. It normally takes 10 minutes or less to complete!

  • What is everyday checking?

    Everyday Checking is our free checking account. This account is convenient and simple with benefits like no minimum balances and no monthly service charges.

    If you're seeking a hassle-free checking experience coupled with top-rated online and mobile banking services, as well as options for overdraft protection and customizable account alerts, Everyday Checking is the ideal choice for you.

    Plus, our online application makes getting your new checking account easier than ever. Simply click here to start your online application as a new member or log into online or mobile banking to open your checking account if you’re already an established member. It normally takes 10 minutes or less to complete!