The ABC’s of IRA’s

What don’t you know?

Many Americans know about Roth and traditional IRAs … but there are other types of IRAs. Here’s a quick look:

Traditional IRA (or deductible IRA) is an individual savings plan for anyone who receives taxable compensation. IRA assets may be invested in any number of vehicles, and contributions may be tax-deductible. Earnings in a traditional IRA grow tax-deferred until withdrawal, but will be taxed when withdrawal begins – and withdrawals must begin by the time the IRA owner reaches age 70½.

Roth IRA offers you tax-free compounding, tax-free withdrawals if you are older than age 59½ and have owned your account for at least five years, and the potential to make contributions to your IRA after age 70½.

SIMPLE IRAs are qualified retirement plans for businesses with 100 or fewer employees.

SEP IRA stands for Simplified Employee Pension. These traditional IRAs are set up by an employer for employees and funded by employer contributions only.

Spousal IRA is actually a rule that lets a working spouse make traditional or Roth IRA contributions on behalf of a non-working or retired spouse.

Inherited IRA is a Roth or traditional IRA inherited by a non-spousal beneficiary.

Education IRA (Coverdell ESA) provides a vehicle to help investors save for a child’s education.

For more information on IRA’s, contact one of our advisors with SouthPoint Investment Services:

Bob Skillings
Financial Advisor Located at SouthPoint Financial Credit Union
706 North German St. New Ulm, MN 56073
Toll Free: 877-794-6712; Direct: 507-233-5624; [email protected]

 

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