February 01, 2012
IRAs - a Third Source
While some people might be able to afford retirement simply through Social Security and their employer’s retirement plan, most people will need additional money to live comfortably after retirement. With an Individual Retirement Arrangement – more commonly known as an IRA – you can have a stable, third source of income that can help you reach your retirement goals.
IRAs are savings accounts funded by an individual specifically to supplement his or her retirement. With Traditional IRAs, contributions to these accounts are made before taxes and grow tax deferred. With Roth IRAs, contributions are made after taxes and grow tax free. Covenant Trust Company manages both Traditional IRAs and ROTH IRAs, and there is no minimum amount required to open the account. So, whether you have a healthy start on your retirement savings or haven’t started at all, CTC can help; we understand that every person has different needs and plans for retirement, so we tailor our IRA investments to each of our client’s individual situations and goals.
If one of your goals is charitable gift giving, IRAs can be a great asset. In previous years, an IRA provision allowed people required to withdraw money from their Traditional IRA to transfer all or part of that money directly to a qualified charity. By doing this, Traditional IRA owners avoided paying income taxes on the portion of the withdrawal that was donated. Unfortunately, this provision has not been renewed for 2012. However, you can still make tax-free donations to your favorite charities by naming them as a beneficiary of your IRA. So just because your career has come to a close, your support for the Covenant church doesn’t have to come to an end as well.
At Covenant Trust Company, we know some people can be uncertain and apprehensive about their retirement. We want to change that; we want to bring certainty and a peace of mind to our clients when they think about their future. So, if you are unsure of your future, or if you’re simply looking for a trustworthy financial partner to manage your IRAs, contact a local Financial Service Representative and let us help you reach your retirement goals.