Retirement Accounts

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An Individual Retirement Account (IRA) is an account that offers tax advantages for funds that you invest during your employment for use during your retirement.

Different types of IRAs offer unique tax benefits that you should consider based on your current employment status and long-term retirement goals. Whether you are taxed now or at the time of disbursement is one of the major points to consider when deciding what kind of IRA is right for you. Consult a tax advisor for information on the best type for you. Regardless of the type of IRA you open, North Shore Federal has a variety of rates and terms available for you.

Traditional Individual Retirement Accounts

Invest tax-free today

With a NSFCU Traditional IRA, not only are yearly contributions generally tax deductible, earnings are tax deferred as well. This type of savings is significant regardless of age. Because you generally do not pay taxes on the funds and earnings in an IRA, you will make a tax payment on every withdrawal once you have retired.

Tax deductible or not, IRAs still offer one of the best tax breaks around — tax deferred earnings until you withdraw funds. And don't think you have to deposit the full allowable contribution for the savings to add up. In fact, payroll deduction makes depositing even small amounts to your NSFCU IRA easy and convenient.

Committing IRA dollars sooner rather than later pays off. Consider the following: Saver No. 1 deposits $2,000 in an IRA earning 6% on Jan. 1 each year vs. Saver No. 2, who waits until the following year on April 15 to start saving $2,000 at 6% each year. At the end of 30 years, Saver No. 1 will have accumulated almost $15,000 more than late Saver No. 2. Saver No. 1 has $173,404.82, Saver No. 2, $158,547.22.

So make the most of your IRA. Your actions today will help you retire comfortably tomorrow. As a way to help you meet your retirement savings needs, NSFCU offers an IRA Share Savings Account and IRA Share Certificates that feature a low $500 minimum and terms from 6 months to 5 years, all fully insured.

Roth IRAs

Withdraw tax-free after retirement.

Roth IRAs are an excellent retirement planning tool offered by North Shore Federal. Roth IRAs allow most taxpayers to contribute up to the allowable amount per tax year. While a contribution to a Roth IRA does not provide you with a tax deduction for the current year, the real benefit comes later. All earnings in a Roth IRA are tax free. This means that at retirement age, you may withdraw all the money from a Roth IRA without paying any taxes.

As you may be aware, earnings usually represent the majority of a retirement savings portfolio. This is the reason why Roth IRAs are so powerful, especially if you start saving in a Roth IRA at an earlier age.

Last, but not least, Roth IRAs contain provisions that allow for withdrawals for specified reasons after the account has been open for five years.

Early withdrawals are allowed:
  • for the purchase of a first home
  • to pay health insurance premiums if you have received unemployment for 12 weeks or longer
  • to pay qualified higher education expenses
  • in the event of disability.
  • Roth IRAs are an integral part in any successful retirement program.

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