It takes careful planning to ensure a financially secure retirement. With this in mind, First National Bank in Pratt offers a variety of attractive Individual Retirement Account (IRA) options. Keep in mind that your IRA funds are insured by the FDIC, up to $250,000.00 per financial institution. We are ready to help you choose the one that is right for you!
Individual Retirement Account (IRA) - A plan set up for the benefit of one person to save for retirement. The particpant must have earned income, be married to someone with earned income and file a tax return. Earnings are taxed-deferred or tax-free depending on the plan type.
Traditional IRA - An IRA plan that takes either deductible or nondeductible contributions. Contributions earn tax-deferred income. The principal and income is taxed as ordinary income when withdrawn. Contributions are not allowed after age 70 1/2 and at this age, a Required Minimum Distribution (RMD) must begin from the account.
Roth IRA - An IRA plan that takes only nondeductible contributions. Contributions earn tax-free income if qualified when withdrawn. Unlike the Traditional IRA, contributions can be made at any age, even over 70 1/2. There is no Required Minimum Distribution (RMD) at age 70 1/2 with the ROTH IRA.
It is important to note that regular contributions to both a Traditional and Roth IRA for the same tax year are added together to get your maximum limits.
To learn more about our Individual Retirement Services Account services, simply stop by for a visit or call us at 620-672-6421.