IRA Basics: Why an IRA Is a Great Gift for Your Future Self

When you think about giving gifts, your future self might not be the first person who comes to mind. But investing in an Individual Retirement Account (IRA) today is one of the best presents you can give to the “you” of tomorrow. At LVECU, we offer both Traditional and Roth IRAs to help members build long-term financial security. Here’s why they’re worth considering and how they can help set you up for success.

What Is an IRA?

An IRA is a type of personal savings account with tax advantages that’s specifically designed for retirement savings. Unlike a standard savings account, an IRA can grow your money faster by offering tax-deferred or tax-free growth, depending on the type you choose.

Traditional vs. Roth IRAs

Both Traditional and Roth IRAs provide powerful savings opportunities, but they work a little differently:

  • Traditional IRA

    • Contributions may be tax-deductible today.

    • Contributions can be made if you have earned income (IRS rules & regulations apply).

    • Earnings grow tax-deferred until you withdraw them in retirement.

    • Ideal if you expect to be in a lower tax bracket when you retire.

    • Insured separately from other account types up to $250,000 by the NCUA.

  • Roth IRA

    • Contributions are made with after-tax dollars, meaning there’s no immediate tax deduction.

    • Contributions can be made if you have earned income (IRS rules & regulations apply).

    • Earnings and qualified withdrawals in retirement are tax-free.

    • Great if you expect to be in the same or a higher tax bracket in retirement.

    • Insured separately from other account types up to $250,000 by the NCUA.

Why an IRA Is a Gift That Keeps Giving

  • Time is on your side: The earlier you start, the more time your money has to grow, thanks to compounding dividends.

  • Flexibility: You can use IRA funds not just for retirement, but in some cases for qualified expenses like a first-time home purchase or education.

  • Security: An IRA creates a safety net, ensuring you’re prepared for the future, no matter what life brings.

Think of it like planting a tree. What starts as a small contribution today grows into something sturdy and dependable for your future.

Tips to Get Started

  • Start small if you need to. Even modest contributions add up over time.

  • Make it automatic with recurring transfers from your checking or savings account.

  • Talk with a financial advisor or tax professional to decide whether a Traditional or Roth IRA is right for you.

Take the Next Step

Your future self will thank you for taking action today. Whether you’re just starting out or looking to boost your retirement savings, an IRA with LVECU is a simple, effective way to prepare.

Learn more about our IRA options or schedule an appointment to open one today!

Remember, LVECU staff cannot provide tax advice, so it’s important to consult a certified tax advisor for personalized guidance.

SavingBrianna Glose