Individual Retirement Accounts

For many of us, our "retirement" years won't be like our parents'. We may choose to start that "dream" business, continue working or just take a breather. In any case, planning and preparing for retirement sooner (rather than later) is the best course of action.

An Individual Retirement Account (IRA) is a great, tax-advantaged way to start and continue saving for your retirement. A First Citizens Securities Financial Advisor can help you select the IRA that meets your needs and show you a wide range of investment vehicles.

Roth IRA

• Contributions are made with after-tax dollars, and your earnings are tax-free upon withdrawal
• There are no age limits for contributing or withdrawing, and you may contribute regardless of whether you participate in an employer-sponsored plan
• To be eligible for a Roth IRA in tax year 2009, your Modified Adjusted Gross Income must be less than $120,000 for single taxpayers or less than $176,000 for married taxpayers filing jointly. For tax year 2010, the Modified Adjusted Gross Income limit for single taxpayers remains the same, but increases to $177,000 for married taxpayers filing jointly.
• Effective January 1, 2010, the income restrictions for converting to a Roth IRA were lifted indefinitely, making you eligible to convert a Traditional, SEP or SIMPLE IRA to a Roth IRA regardless of your income. Typically you will pay income tax on the taxable amount converted. Under a special rule for conversions that are completed in 2010 (only), you may spread the tax liability equally over 2011 and 2012.

Traditional IRA

• Contributions may be tax deductible.
• You are not taxed on earnings until you withdraw funds at retirement.
• There are no income limits, and anyone under age 70½ with earned income is eligible to contribute.

Simplified Employee Pension (SEP) IRA

If you are self-employed or are a small business owner, a SEP is a great way to establish a retirement plan for you and your employees.

• Employers make tax-deductible contributions into a Traditional IRA in the name of each employee.
• Employees enjoy tax-deferred earnings.
• Plan is easy to establish and maintain.

Rollover IRAs

If you're changing jobs or retiring, you may be having funds disbursed from a tax-qualified retirement plan. By taking a cash payout, you may be faced with substantial tax consequences.

A First Citizens Securities Financial Advisor can show you how investing or "rolling over" funds that have not yet been taxed into a Rollover IRA can help your nest egg keep growing, tax deferred. Plus, you can continue making annual contributions to your IRA, to help reach your goals faster.

To learn more about First Citizens Securities retirement services, e-mail us or call 1-866-931-1691.