- Dividends are earned daily, compounded and credited monthly
- Available to Tower members who receive earned income and non-wage earning spouses of Tower members
- Rollovers and transfers available
Even if you have a retirement plan through your employer, it’s a good idea to establish and contribute annually to an IRA to ensure you have the funds you need in the future.
If you have a qualified retirement plan, such as a 401(k), it may be rolled into a Traditional or Roth IRA. You can also transfer an IRA from another financial institution to a Tower IRA. There is no limit on transfers.
Decide which IRA is right for you:
| IRA Basics * | Traditional IRA | Roth IRA |
|---|---|---|
| Contributions | Up to $6,000, or $7,000 if age 50 and older, for 2022. Up to $6,500 or $7,500 age 50 and older, for 2023. | Up to $6,000, or $7,000 if age 50 and older, for 2022. Up to $6,500 or $7,500 age 50 and older, for 2023. Subject to modified adjusted gross income limits |
| Maximum Contribution age limit | None with earned income | None with earned income |
| Taxation | Earnings taxed at withdrawal Contributions may be tax deductible, check with a tax advisor | Earnings grow tax-free |
| Withdrawals | Optional beginning at age 59 ½, then mandatory withdrawals begin at age 72. | Optional beginning at age 59 ½ No mandatory withdrawal age |
| Early withdrawal | Penalties apply; exceptions exist for first time home purchase, higher education expenses, or if disabled. | |
| * Consult a tax advisor for details. | ||
Tower offers an IRA Club account, IRA Share Certificates and a Simplified Employee Pension (SEP).
Whether you want to invest $500 or more than $20,000, an IRA Share Certificate is a simple and secure way to earn greater returns on your retirement savings. We offer a variety of term options and initial deposit requirements that can be used for both Traditional and Roth IRAs.
- Regular IRA Share Certificates offer the most term length options and require the lowest initial deposit.
- Bump-Up Share Certificates allow you to increase your rate once if rates climb during the term.
- Mini-Jumbo Share Certificates offer longer terms for greater deposit amounts.
Dividends are calculated using the daily balance method, which applies a daily periodic rate to the balance of the Share Certificate and is subject to an early withdrawal penalty. Additions to your IRA Share Certificate cannot be made for the term unless they complete a current tax year contribution.
Current Rates
| Dividend Rate % | APY % | Minimum to Open | |
|---|---|---|---|
| IRA Club Account | 0.85 | 0.85 | $5 |
| Regular IRA Share Certificates | |||
| 1 year | 3.45 | 3.50 | $500 |
| 2 year | 4.02 | 4.10 | $500 |
| 3 year | 2.52 | 2.55 | $500 |
| 4 year | 2.62 | 2.65 | $500 |
| 5 year | 2.67 | 2.70 | $500 |
| Bump-Up IRA Share Certificates | |||
| 4 year Bump-Up | 2.37 | 2.40 | $5,000 |
| 5 year Bump-Up | 2.42 | 2.45 | $5,000 |
| Mini-Jumbo IRA Share Certificates | |||
| 4 year Mini-Jumbo | 2.67 | 2.70 | $20,000 |
| 5 year Mini-Jumbo | 2.76 | 2.80 | $20,000 |
| Rates effective: 2/1/2023 APY = Annual Percentage Yield. APR = Annual Percentage Rate. Fees can reduce earnings. Rates are subject to change. Withdrawal of the Share Certificate funds before the maturity date will incur an early withdrawal penalty. |
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The easiest way to start saving for retirement is by opening an IRA Club account. You can use this account to steadily grow your IRA funds or to build up enough savings to open an IRA Share Certificate.
- Available as both Traditional and Roth IRA
- $5 minimum opening deposit
- Make deposits any time in any amount, up to the maximum annual contribution limit
- Dividends are earned daily, credited monthly
This account can be also used for IRA funds transferred from another financial institution or rolled over from a qualified retirement plan.
Current Rates
| Dividend Rate % | APY % | Minimum to Open | |
|---|---|---|---|
| IRA Club Account | 0.85 | 0.85 | $5 |
| Regular IRA Share Certificates | |||
| 1 year | 3.45 | 3.50 | $500 |
| 2 year | 4.02 | 4.10 | $500 |
| 3 year | 2.52 | 2.55 | $500 |
| 4 year | 2.62 | 2.65 | $500 |
| 5 year | 2.67 | 2.70 | $500 |
| Bump-Up IRA Share Certificates | |||
| 4 year Bump-Up | 2.37 | 2.40 | $5,000 |
| 5 year Bump-Up | 2.42 | 2.45 | $5,000 |
| Mini-Jumbo IRA Share Certificates | |||
| 4 year Mini-Jumbo | 2.67 | 2.70 | $20,000 |
| 5 year Mini-Jumbo | 2.76 | 2.80 | $20,000 |
| Rates effective: 2/1/2023 APY = Annual Percentage Yield. APR = Annual Percentage Rate. Fees can reduce earnings. Rates are subject to change. Withdrawal of the Share Certificate funds before the maturity date will incur an early withdrawal penalty. |
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Simplified Employee Pension (SEP)
A simplified employee pension (SEP) is a pension plan established by a business or sole proprietor. Contributions are deposited into IRAs and are tax deductible by the employer. SEP contributions are limited annually to 25 percent of compensation, or $61,000 for 2022 and $66,000 for 2023, (whichever is smaller) for each eligible employee.
To open an IRA, visit a branch or call the Member Service Center at 301-497-7000 or 866-56-TOWER.