Investments |
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Certificates of Deposit
One of the best pathways to building wealth is by opening a Certificate of Deposit, commonly referred to as a CD. A Certificate of Deposit allows a member to deposit a lump sum of money for a fixed amount of time. Over this time, the money in the account earns periodic interest and is insured by the NCUA. When the account reaches maturity at the end of the term, members may roll the money (the original deposit along with accrued interest) over to a new CD or withdrawal it to do with as they choose. There’s no easier way to make money!
Abbey Credit Union offers CDs in terms ranging from 6 months to 5 years with a minimum deposit of $1,000. Penalties may apply for early withdrawal. Please refer to the Disclosure Document provided by an Abbey Credit Union Staff Member for the Terms and Conditions of a Certificate of Deposit.
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IRA Accounts/ Retirement
Traditional IRA
If you work and earn an income, there's no better way to save money for retirement and take advantage of federal income tax savings than by opening up an Individual Retirement Account. A traditional IRA program allows you to defer taxes on your earnings until you withdraw the funds. Depending on your own tax situation, you may be able to receive a tax deduction for this type of deposit. Once you reach the age of 70 ½ you will need to begin withdrawing funds.
Roth IRA
The new ROTH IRA provides tax-free earnings on non-deductible, after-tax contributions. This IRA, which allows all earnings to grow tax –free, is gaining popularity because the there is no age at which you must start distributions from the account. Another big advantage is that distributions of funds held for at least five years will be tax-and penalty-free for the following reasons:
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After 59 ½ years of age
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Disability
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Death
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First-time home purchase
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Since you'll be paying taxes on contributions now, instead of at retirement, a Roth IRA could be a wise choice for anyone who expects his/her tax bracket to be about the same-or even higher after they retire. |
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