IRAs

A Traditional IRA is a retirement savings plan that offers the flexibility of making possible tax-deductible contributions. The earnings will also grow tax-deferred. Taxes* may be applied to withdrawal amounts.

There are two advantages that the Traditional IRA offers which make this type of IRA a powerful tool in creating a balanced, long-term savings plan:

Depending on your circumstances, you may be able to deduct your contribution(s) (all or in part) from your annual income at the end of the year and

• Generally, amounts in the IRA including earnings and gains are tax deferred until a distribution is taken.

Unlike the Traditional IRA, the new contributions you make to your Roth IRA cannot be deducted from your annual income. However, if your earnings meet the necessary requirements, then you can withdraw them tax-free and penalty-free. Another unique feature the Roth IRA has to offer is that it allows you to continue making new contributions even after age 70 ½, again as long as you meet the basic requirements.

SEP IRA

SEP IRA stands for Simplified Employee Pension. A SEP plan is really a Traditional IRA used for SEP purposes. Employers, including self-employed individuals, are eligible to establish SEP plans. A SEP plan allows an employer to make contributions toward their employees’ retirement.

Coverdell ESA

An ESA (Educational Savings Account) is an investment tool created for the purpose of paying for the future cost of a child's education. The plan allows total after-tax contributions of $2,000 per year for each child until they reach the age of 18. These contributions and their subsequent earnings are tax-free when withdrawn to pay for qualified education expenses.

*If you have questions about your specific tax situation, please consult your tax advisor for an interpretation of how these rules apply to you.