Mobile App
Open Account
Online Banking
Cash Management
Cash Management (Soft Token Required) ACH Originators and Merchant Capture Deposits
Single Post Featured Image

August 16, 2020

How to Open an IRA

Start saving for your future with an Individual Retirement Account!

Preparing for retirement can be scary. With all the new vocabulary and unfamiliar acronyms, it’s hard to know where to start. An Individual Retirement Account (IRA) can be an easy first step to preparing for retirement and planning for your financial future.

What is an IRA?

An IRA is an investment account opened by an individual rather than a company, like a 401(k). Both 401(k)s and IRAs offer tax benefits to people saving for retirement and you can contribute to both at the same time. In simple terms, an IRA can offer you access to more investments while a 401(k)allows much bigger maximum annual contributions and some employers match your contributions to a certain percentage.

Traditional or Roth, which is right for me?

There are two types of IRAs: traditional and Roth. Traditional IRAs have taxes deducted as you withdraw your funds during retirement. In a Roth IRA taxes are deducted before they deposit in the account. Take taxation into account when making your decision. Do you think taxes will be higher or lower when you get to retirement age? Many choose a Roth IRA because they think taxes will be higher in the future. Taking out your taxes before you deposit means what is in your account is what you will withdraw. Others choose a traditional IRA. With a larger deposit they can increase their interest earnings then deduct taxes.

How and where do I open an IRA?

There are many online brokers where you can open an IRA and select and manage your own investments yourself. Drop by your local Citizens First Bank branch to discuss different options to find the type of account and management that works for you and your financial goals.

How do I open an IRA?

If you opt for an online broker, do your research to ensure they are trustworthy and reliable as you will be providing important personal and financial information. We are happy to help you set up an IRA at CFB. You can open an IRA with as little as $5 and maintain a minimum balance to start earning interest. Competitive rates are available at all branches. Education and Simple IRAs are also available, upon request.

Preparing and planning for the future doesn’t have to be hard. All it takes is a little research to gain enough confidence to make the next step. You’ll be well on your way to a fully funded retirement in no time. Call and set up an appointment to discuss next steps to opening an IRA and start investing in your future!