Your Hometown Bank wants you to live comfortably and save smartly. That’s why we offer Traditional, Roth, and Education IRAs! To open an IRA with Fidelity you’ll need a $50 minimum deposit. Learn more about each of our IRA options below.
Traditional IRA
Our Traditional IRA may be tax deductible based on three factors - active participation in an employer sponsored retirement plan, federal income tax filing status, and modified adjusted gross income. We always recommend contacting a tax advisor on the deductibility of your IRA contributions. Earnings are tax deferred and taxable at the time of withdrawal. In 2024, an individual can contribute up to $7,000 and individuals aged 50 and older may make additional contributions up to $1,000 as a ‘catch-up’ contribution.
Roth IRA
Roth IRAs are nondeductible accounts with tax-free withdrawals for certain distribution reasons after a 5 year holding period. You must have earned income and fall within certain income guidelines to contribute. After the account holder reaches age 72, there are no withdrawal requirements. In 2024, an individual can contribute up to $7,000 and individuals aged 50 and older may make additional contributions up to $1,000 as a ‘catch-up’ contribution. Earnings on the account may grow tax free if certain conditions are met.
Education IRA
An Education IRA is a Coverdell Education savings account set up for a child’s higher education. Save money on a tax deferred basis with contributions that are not tax deductible. Withdrawals from the account for educational expenses are tax free and IRS penalty free. The maximum contribution allowed is $2,000, and must be made by April 15 for the previous year.
Simple IRA
A Simple IRA is a savings incentive match plan for employees of small employers. All types of businesses can establish Simple IRA plans. An employer must have 100 or fewer employees and have no other retirement plan. There are two basic types of SIMPLE IRA plan contributions - voluntary employee salary reductions and required employer contributions. 2024 Deferral limits are $16,000 with an additional $3,500 ‘catch up’ contribution for individuals over age 50.
SEP Plan
Under a SEP (Simplified Employee Pension) plan, an employer can decide to contribute to employees’ IRAs. Contributions are directed into a Traditional IRA held by each employee. Investment decisions and performance are the responsibility of each employee. Contributions are usually the same percent of each employee's compensation (maximum of 25%), but some plans may instead specify a fixed dollar amount for all employees. Employees who participate in a SEP plan are considered "active participants" in an employer-sponsored retirement plan. This may affect the deductibility of their Traditional IRA contributions, depending on their income.
SEP plan participation does not, however, reduce or eliminate an employee's ability to fund a Traditional IRA, and all Traditional IRA earnings are tax-deferred, regardless of SEP plan participation. More importantly, a SEP plan offers a contribution that is potentially much larger than a Traditional IRA contribution. 2024 SEP Contribution limits are $69,000, or 25% of compensation up to $250,000, the lesser of the two.
IRA CDs
At Fidelity Bank & Trust your investments to your IRA are held in CDs. You may choose a CD term or an IRA Savings CD. A CD term does not allow contributions until maturity, but you may earn a higher rate of interest than the IRA Savings CD.
IRA Savings CD
An IRA Savings CD allows you the convenience to contribute to your investment at any time throughout the year. The IRA Savings CD earns a rate of interest that may change at any time.
IRA Preferred Rate Savings CD
IRA Preferred Rate Savings CD is the account for you if you’re looking for a higher interest rate than IRA Savings CD. With a minimum deposit of $50,000 to open and a minimum maintenance balance of $50,000 you’ll enjoy a higher rate of interest than a traditional IRA Savings CD. Rollovers and transfers are accepted. The rate may change at any time.
Come talk with us about which plan will work best for you.