IRAs

The security of your future lies in saving for retirement. One of the easiest ways to do just that is by contributing to an NCP Individual Retirement Account (IRA). Since 1974, IRAs have been one of the tax-advantaged retirement alternatives to assist Americans in saving for their post-work goals. NCP offers both Traditional and Roth IRA's, as well as Education IRAs to enable you to save for a child's education expenses. All three accounts are offered in both savings and certificate form to give you the most flexibility. Some people may be eligible for a Retirement Savings Contributions Credit when filing their taxes- consult your tax advisor.

Traditional IRA

Contributing to a traditional IRA is one way to build your retirement savings. A traditional IRA may be opened by any individual who has earned income, and wishes to defer or eliminate the payment of taxes on income on funds set aside for retirement. Contributions to traditional IRAs may not be made if you are 70½ years of age, or over.

If you are eligible to contribute to your IRA, the amount of the contribution for which you may take a tax deduction will depend upon whether you (or, in some cases, your spouse) are an active participant in an employer-maintained retirement plan.

ROTH IRA

If you want to avoid federal taxation on your IRA earnings - both while they are invested and upon withdrawal - then a Roth IRA may be a valuable option for you. With a Roth IRA, all contributions are made on an after-tax basis. So, unlike a traditional IRA, a Roth IRA does not allow for up-front tax deductions.

Instead, when you take a distribution from a Roth IRA, you may be able to benefit from tax-free earnings if you meet certain requirements. These tax-free earnings could be more valuable to you in the long run than an up-front tax deduction.

Education IRA (Coverdell Education Savings Account)

The Educational IRA is a nondeductible account that features tax-free withdrawals for a very specific purpose--a child's education expenses.

At first glance, the Educational IRA looks similar to traditional and Roth IRA's. After all, higher education distributions are permitted from these accounts as well. The crucial difference is that while qualified higher education distribution from a Traditional or Roth IRA are penalty free, qualified education expense distributions from an Educational IRA are penalty free and tax free.

Contribute early to whichever IRA is right for you. The younger you start, the sooner your money starts earning interest, and the more time your account has to grow. Call or come by any branch today for additional information and to open your IRA account with as little as $100.00. (To earn dividends on your IRA account, an average daily balance of $200.00 must be maintained.) IRA accounts are insured separately up to $250,000 by the National Credit Union Administration, and agency of the federal government.

For more information on IRAs, please consult the IRS document 590 and your tax advisor.