Individual Retirement Accounts

Individual Retirement Accounts (IRAs) are special-purpose savings plans created by the federal government to help you build funds specifically for your retirement.  The two most common types of IRAs are Traditional IRAs and Roth IRAs.

Traditional IRAs allow you to make contributions that may be tax deductible.  The tax deductibility of the contributions depends on whether you were covered by a retirement plan at work and the amount of your adjusted gross income for the year. The interest that is earned on Traditional IRAs is not taxable to you until you withdraw it. This helps your money grow much faster than in a comparable, taxable investment.

Roth IRA contributions are not tax deductible but, if you satisfy certain requirements, distributions may not be subject to taxes.  Other differences between Roth IRAs and Traditional IRAs are that Roth IRA contributions may be made after you reach age 70 ½ and you can leave amounts in your Roth IRA as long as you live.  With Traditional IRAs you are required to begin taking distributions from you IRA after you reach age 70 ½.

Contributions to IRA Accounts may be made anytime during the year.  You may also make contributions up until your tax due date, which is usually April 15, and classify the contributions as being made for the prior year.

If you currently have an IRA at another institution, you can move your Individual Retirement from one institution to another without a tax penalty. Just because you open your account at one institution doesn't mean you have to keep it there until retirement. The Bank of Hindman offers competitive IRA rates. If you have an IRA at another institution, give us a call to compare rates.

If you recently changed jobs and have a Pension or Profit Sharing plan that you wish to transfer to an IRA Account, we will be more than happy to assist you.

Competitive Fixed Rates