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Individual Retirement Accounts (IRAs)
Retirement is a beautiful thing. An IRA from F & M Community Bank helps keep it that way by establishing financial backing for your future dreams. We offer both traditional and Roth plans, plus an education fund for college expenses — each with different associated tax advantages.
Benefit from interest above standard savings, helping you get closer to the perfect future that you deserve. Whether your ideal retirement looks like a golf course, a boat, or relaxing down time with the family, keep it within your reach by starting to set aside in an F & M IRA early.
- Tax-advantaged retirement savings*
- Competitive interest above standard savings rates
- Traditional and Roth IRA options
- No setup fees
- No monthly or annual maintenance charges
- $5,000 contribution limit per year
- Additional $1,000 "catch-up" contribution allowed for ages 50+
- Funds can be used to purchase CDs or fund savings accounts within an IRA
- No minimum deposit to open account
- $1,000 minimum deposit to open a CD within the IRA
*Consult a tax adviser.
- Traditional vs. Roth
There are advantages to both traditional and Roth IRAs. One of the biggest differences is the time at which you see the most advantage. A traditional IRA provides potential tax relief today, while a Roth IRA has the potential for the most tax benefit at time of retirement.
- No income limits to open
- No minimum contribution requirement
- Contributions are tax deductible on state and federal income tax*
- Earnings are tax deferred until withdrawal (when usually in lower tax bracket)
- Withdrawals can begin at age 59 ½
- Early withdrawals subject to penalty**
- Mandatory withdrawals at age 70 ½
- Income limits to be eligible to open Roth IRA***
- Contributions are NOT tax deductible
- Earnings are 100% tax free at withdrawal*
- Principal contributions can be withdrawn without penalty*
- Withdrawals on interest can begin at age 59 ½
- Early withdrawals on interest subject to penalty**
- No mandatory distribution age
- No age limit on making contributions as long as you have earned income
*Subject to some minimal conditions. Consult a tax advisor.
**Certain exceptions apply, such as healthcare, purchasing first home, etc.
***Consult a tax advisor.
- Coverdell Education Savings Account (CESA)
Create an easier transition into college for yourself and your student by setting up a savings account early. A Coverdell Education Savings Account (CESA) provides a tax-free safe place to grow competitive interest and also financial confidence for a new stage in life.
- Set aside funds for your child's education
- No setup or annual fee
- Interest grows tax-free
- Withdrawals are tax-free and penalty-free when used for qualified education expenses*
- Designated beneficiary must be under 18 when contributions are made
- To contribute to a CESA, certain income limits apply**
- Contributions are not tax deductible
- $2,000 maximum annual contribution per child
- The money must be withdrawn by the time he or she turns 30***
- The CESA may be transferred without penalty to another member of the family
- No minimum deposit to open
*Qualified expenses include tuition and fees, books, supplies, board, etc.
**Consult your tax advisor to determine your contribution limit.
***Those earnings are subject to income tax and a 10% penalty.