IRA

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IRA - Individual Retirement Annuity

An Individual Retirement Annuity is a type of personal pension plan. Like all retirement plans, an IRA is designed to help you accumulate money for retirement. An Individual Retirement Annuity can help you save for retirement in several ways:

If you qualify, you can deduct you IRA contributions for federal tax purposes.
Interest earnings on an Individual Retirement Annuity are tax-deferred until you take them out.
Retirement can be the greatest years of your life.

Start preparing now by saving with an Individual Retirement Annuity from Erie Family Life. It's a great idea!

Can I Deduct My IRA Contribution From My Taxes?

Generally, if you or your spouse are not covered by an employer-sponsored retirement plan, both of you can deduct your IRA contribution for federal income tax purposes. The amount of deduction is the lesser of 100 percent of your earned income, or $2,000. If you or your spouse are covered by a qualified retirement plan and your combined adjusted gross income falls within certain limits, you may still be eligible for a total or partial deduction. For example, if you are single filer and your adjusted gross income is less than $25,000 you can deduct up to $2,000. If your income is over $35,000, you are not eligible for a deduction. If your adjusted gross income is between $25,000 and 35,000, you are eligible for a partial deduction. For married filers, the limits are $40,000 and $50,000 respectively.

Can My Spouse Contribute to an IRA?

Yes. Your working spouse can make a tax deductible contribution as long as the eligibility requirement previously described are met. Your non-working spouse is eligible for a Spousal IRA. The maximum annual contribution for both spouses is $2,250 which can be allocated in any fashion as long as no more than $2,000 is deposited in either spouse's IRA.

When Can I Take Money Out of My IRA?

Withdrawals and retirement benefits can be taken out at any time. Certain penalties apply to distributions made before age 59 . There are exceptions that avoid the penalty. Consult your tax advisor to determine if there will be any penalty imposed on distributions taken before age 59 . In addition, you must begin taking at least the required minimum annual distribution from your IRA by April 1 of the year following the year in which you reach age 70 .

When Do I Pay Taxes on My IRA?

IRA benefit payments are reportable as ordinary income in the year they are received.

What Settlement Options Do I have at Retirement?

Erie Family life offers a variety of settlement options. With careful planning you can design a benefit schedule to meet any need or situation. Some of the more popular options include:

A Life Annuity: Pays an income for as long as you live.
A Period Certain Annuity: Pays an income for a specified number of years including a lifetime income annuity.
Payments of a Fixed Amount: Pays a fixed amount until the account value is exhausted.
Interest Only- Pays the interest earnings on a periodic basis, thereby preserving the account value.
A Joint and Survivor Annuity: Pays an income for as long as either you or the joint annuitant is alive.

In the event of death during the benefit payment period, any remaining guaranteed payments are paid according to the original benefit schedule to the designated beneficiary.

What Makes an Erie Family Life IRA So Attractive?

Flexibility of Premium payments: You can establish an individual Retirement Annuity with a one-time premium payment, or a Flexible Premium Retirement Annuity designed to accept periodic contributions.
Flexibility of settlement Options: You can select from a variety of settlement options that can be tailored to your situation. You can even select an income option that provides you an income you cannot outlive.
Optional Waiver of Premium Benefit: This benefit provides for the continuation of annuity premium payments should you become permanently disabled as provided for in the contact.
No "Front-End" Loads or Expense Charges: The only charge applicable to an Erie Family Life Annuity is a graded surrender charge imposed on partial or complete surrender made within the first five years of the contract.
Proceeds Not Subject to Probate: Proceeds paid to a named person as a result of the annuitantís death are not subject to probate.

The Thomas M. Frick Insurance Agency can provide you with the necessary information and procedures to start an Erie Family Life IRA today.

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