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IRAs

Important IRA Updates for 2010

Imagine retiring with an IRA that grows free of federal income tax. With recent changes to IRS rules for the Roth IRA, now you can. To learn more about these changes, click here.

Should You Switch Your Traditional IRA to a Roth IRA?

Many people with traditional IRAs have questions about whether converting to a Roth is the right move. We'll help you explore which IRA may be the best way to invest your funds and find a solution that will work hardest for you. Use our IRA Chart to view these IRA options side-by-side.

Contact us at 570.275.3740 or 1.800.222.2547 to get started.

What is an IRA

An IRA is an Individual Retirement Account, established by an individual to provide for his or her own retirement.This investment option is an excellent way to save for retirement where choices of tax-deferred contributions or tax-free earnings are available. Recent changes in legislation have made it even more beneficial to invest in an IRA.

With all of the options available, isn't it reassuring to know FNB Bank is here to help? At FNB Bank, we are committed to helping you make informed decisions about all of your investments, which is why we want you to know some IRA basics before you choose what retirement option is best for you.

Different Types of IRAs

Traditional IRA

The earnings in a Traditional IRA grow tax-deferred until they are withdrawn. Depending on your income, contributions to Traditional IRAs are also tax-deductible up to the full amount of the contribution.

Roth IRA

A Roth IRA is similar to a Traditional IRA in many ways, the major difference being that the contributions to a Roth IRA are not tax-deductible, which also means that the interest and earnings in a Roth IRA accumulate tax-free. The Roth IRA must be specified as such when the account is opened.

Spousal IRA

According to the IRS, you are eligible to contribute to a Spousal IRA if all of the following conditions are met:

  • You must be married at the end of the tax year
  • Your spouse must be under the age 70 1/2 at the end of the tax year
  • You must file a joint return for the tax year
  • You must have taxable compensation for the year
  • Your spouse must either have no compensation or choose to be treated as having no compensation for the tax year

Coverdell Education Savings Accounts (formerly Educational IRAs)

The purpose of this account is to provide people with a tax-advantaged savings instrument for educational needs. The funds contributed to this account are viewed as a gift to the designated beneficiary under the age of 18. It is extremely important that the funds contributed to this account be coordinated with other educational payment plans.

FNB Bank's IRA Plans

FNB Bank offers a variety of IRA plans to meet your individual needs. There is absolutely no fee to open your IRA. Best of all, your FNB Bank IRAs are insured up to $250,000 by the Federal Deposit Insurance Corporation.

As you approach retirement, you want to ensure that your accumulated IRA benefits will meet your goals. FNB Bank can review your needs with you, and help to create a distribution schedule that meets your financial objectives. You'll receive comprehensive statements and reporting, whenever you need it.

Variable Rate IRA CD

Invest your IRA funds with a Variable Rate IRA CD. There is an 18-month maturity term with the rate changing on the first calendar day of each month. You can open this IRA CD with as little as $500.

Fixed Rate IRA CD

With a Fixed Rate IRA CD, you can choose a term from 1-5 years with just a $500 minimum deposit per certificate. Interest on your Fixed Rate IRA CD is compounded daily, meaning you'll receive maximum tax-deferred interest on your IRA funds.

IRA Cash Reserve Account

With an IRA Cash Reserve Account there is no minimum balance requirement, no monthly service fee. Interest will be compounded daily and credited monthly.

IRA Rates

Description Interest
Rate		 APY
Cash Reserve Account 0.25% 0.25%
1.5 Year Variable Rate 0.26% 0.26%
1 Year 0.70% 0.70%
18 Month 1.39% 1.40%
36 Month 1.98% 2.00%
4 Year 2.03% 2.05%
5 Year 2.18% 2.20%
6 Year 2.66% 2.70%

IRA Disclosure

Member FDIC. Rates subject to change and may be withdrawn without notice. Annual Percentage Yield (APY) is in effect as of this publication date and assumes principal and interest remain on deposit for term stated. Penalty may apply for early withdrawal. Certificate of Deposit rates can be applicable to IRA accounts. Minimum deposit to open and obtain APY is $500. Fees could reduce earnings on the account. For current rate information or Account Agreement Disclosure information, please call our Direct Banking Center at 1.800.222.2547.