Consumer Savers of America

   Planning for your retirement is a key factor in ensuring a comfortable, secure future. Individual Retirement Accounts (IRAs) allow your returns to grow tax deferred until withdrawal. There are a variety of IRAs to help you build your retirement nest egg.

Traditional IRA

    The Traditional IRA allows you to take advantage of federal income tax deferred earnings and possible yearly tax deductions. This type of IRA can help you pay less in taxes now, using pre-tax dollars to build principal for more earnings later. Everyone under age 70½ with earned income may participate in a Traditional IRA; however, income limits determine eligibility for tax deductions.

Roth IRA

    While Roth IRA contributions are not tax deductible, earnings are free from federal tax (if certain conditions are met). The Roth IRA also has a lot of flexibility to help you meet your retirement goals. You can access your contributions without IRS penalty, you may continue to save for retirement past age 70½, and there are no mandatory distribution requirements.

Coverdell Education Savings Account (Currently available in VA, MD and DC only)

    Parents, grandparents or friends may want to look into this new account. Annual non-deductible contributions of up to $2000 a year per child may be made to this type of IRA. The earnings on your contributions are federal tax-free as long as they are used to pay for the child's higher education expenses.

SEP IRA'S (Simplified Employee Pension)

    A SEP is an effective and simple way for business owners and self-employed individuals to build their retirement savings. SEPs are easy to set up and maintain with little paperwork or administrative responsibility for your company.

SIMPLE IRA

    A SIMPLE IRA is a cost-effective way for employers with fewer than 100 employees to maintain a retirement plan. It encourages employees to fund their own retirement accounts through salary deferral contributions. A limited level of employer contributions is also required.

IRA Rollovers

    If you are about to change jobs or retire, you may be eligible to receive a distribution from your 401(k) plan. If so, rolling these funds into an IRA will keep the funds tax deferred until withdrawal.

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