Individual Retirement Accounts (IRAs)

Individual Retirement Accounts (IRAs)

Little in life is guaranteed. But you can guarantee a secure future. Just open and fund an IRA with First Federal Community Bank to realize earnings from FDIC-insured investments. The sooner you start, the richer your retirement will be.

We offer traditional and Roth IRAs, as well as Coverdell Education Savings Accounts (CESA) and Simplified Employee Pension (SEP) Plans. To encourage you to save, we never charge setup or monthly maintenance fees. Start down the path to financial security today!

Summary
  • Tax-advantaged retirement account
  • Competitive interest above standard savings rates
  • Compound interest creates sizable earnings
  • No setup or maintenance fees
  • Maximum yearly contribution limit applies (determined annually by IRS)
  • CDs available for balances of $500 or more
  • IRA Flex Plan functions like savings account and only requires $25 minimum balance
  • Sole proprietors and self-employed can open an SEP IRA

Check out our current rates.

Traditional vs. Roth

Both traditional and Roth IRAs offer unique tax advantages. A Roth IRA, if you are eligible to open, can sometimes provide greater tax relief in the long run. While a traditional IRA typically provides some immediate tax relief as well as upon withdrawal.

Traditional IRA

  • No income limits to open
  • Contributions are tax deductible on state and federal income tax*
  • Earnings are tax deferred until withdrawal (when usually in lower tax bracket)
  • Withdrawals can begin at age 59½
  • Early withdrawals subject to penalty**
  • Mandatory withdrawals at age 70½

Roth IRA

  • Adjusted gross income must be less than $122,000 to contribute ($179,000 for joint filers)
  • Contributions are NOT tax deductible
  • Earnings are 100% tax free at withdrawal
  • Principal contributions can be withdrawn without penalty*
  • Withdrawals on interest can begin at age 59½
  • Early withdrawals on interest subject to penalty**
  • No mandatory distribution age

*Subject to some minimal conditions. Consult a tax advisor.

**Certain exceptions apply, such as healthcare, purchasing first home, etc.

CESA

A Coverdell Education Savings Account (formerly called an Education IRA) provides similar tax-free earnings to an IRA. The funds, however, are dedicated to a very specific purpose—a child's future education expenses.

  • No annual fee
  • Dividends grow tax free
  • Withdrawals are tax free when used for qualified education expenses*
  • Contributions are not tax deductible
  • Contributions can be made until the child is 18 years old
  • Funds must be distributed when recipient reaches age 30
  • Contributors do not have to be related to recipient
  • Individuals and non-individuals (such as companies or charities) can contribute up to $2,000 per child per year

*Qualified expenses include tuition and fees, books, supplies, board, etc.

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