Individual Retirement Accounts (IRAs)

A Traditional IRA is great way to save for retirement because of the special federal laws governing the taxation of amounts earned within an IRA.  With uncertainty over Social Security being able to meet the needs of future retirees, you may have to rely more heavily on your own resources in retirement. The good news is it’s easy to get started saving today.

Tax Benefits

• Money you contribute (deposit) may be tax-deductible when you file your income taxes — therefore reducing your taxable income.¹
• You can contribute pre-tax dollars to a Traditional IRA, potentially giving you the opportunity to save more of your money.
• Your earnings in a Traditional IRA are tax-deferred until they are withdrawn from your account. This means you won’t be charged taxes on these earnings until the time you take money out of your account.

Ways to Save

• You can begin savings on your own, without the need for an employer sponsored plan.
• ESL offers two savings options for a Traditional IRA with certificates or Money Maker savings accounts.
• IRA funds from an employer or another financial institution can be transferred to ESL.

And remember, your IRA balances are eligible for our unique Owners' Dividend.²

¹Consult your tax advisor.  ²Qualification for the Owners’ Dividend is subject to eligibility requirements. Payment of a Dividend is not guaranteed

 

Contribution and Opening Requirements

• Contributions can be made at any age.
• To open an account, you need earned income that is equal to or greater than your contribution.
• If you are under age 50, you can contribute up to $7,000 for 2024. For those over age 50, a maximum contribution of $8,000 is permitted within the year.
• Contributions can be made at any time in the year up to the maximum allowed.

Savings Options

• IRA Money Maker Account.
  • No minimum balance required.
  • Access your funds as you need them to move between IRA accounts or qualified retirement investments or for distributions.
  • Learn more about ESL Money Maker Accounts.
• IRA Certificate Accounts
  • $100 minimum balance for a non-jumbo certificate.
  • $100,000 minimum balance for a jumbo certificate.
  • Terms from 31 days to 120 months.
  • Money in a certificate account is not available until your certificate maturity date, otherwise penalties apply.
  • Learn more about ESL Certificate Accounts.

Qualified Distributions (Withdrawals)
A qualified distribution means you will not be charged the IRA 10% early distribution penalty. Qualified distributions include:

• After age 59½
• In the year in which you reach age 73, you will begin receiving mandatory distributions called required minimum distributions (RMDs)
• Death
• Disability
• Certain medical expenses
• Health insurance premiums following unemployment
• First-time homebuyer expenses
• Higher education expenses
• IRS levy
• Rollovers

Each of these circumstances is unique, and you should consult your tax advisor to learn more.

Early Distribution Tax Information

Distributions from a traditional IRA before age 59 1/2 may be subject to an IRS 10% early distribution penalty tax unless the money is used for one of the following exceptions:

• Qualified higher education expenses
• Qualified first home purchases (lifetime limit: $10,000)
• Certain major medical expenses
• Certain long-term unemployment expenses
• Disability
• Substantially equal periodic payments (SEPP)

Consult your tax advisor for more information.

Ready to open? It’s easy.

• Connect with us so we can help.
• Are you a new member? Be prepared with the documentation needed to open an account. Learn more >

We’ll show you how easy it is to open an IRA at ESL.