Compare Traditional IRAs and Roth IRAs.

Individual retirement accounts (IRAs) are investment accounts specifically set up to save for retirement by offering significant tax advantages. It’s never too late, or too little, to start saving for your financial future. Compare below which IRA option may be right for you.

Traditional IRA

With a traditional IRA, your contributions are tax-deductible, meaning you won’t pay taxes on your money until retirement. If you expect your tax rate during retirement to be lower than it is today, or if you want to reduce taxable income now, this option may be a better fit for you.

Account Summary

  • Contribute $7,000 if you're under age 50 / $8,000 if you're age 50 or older1
  • Contributions may be tax-deductible if you meet certain conditions1
  • Withdraw funds without penalty beginning at age 59½. Withdraw before 59½ at 10 percent penalty (plus possible bank fees), with certain exceptions1
  • Distributions must begin by April 1st of the year following the year you reach age 732
  • Anyone who has earned income is eligible2
  • Traditional IRAs can generally be converted to Roth IRAs, although tax consequences may apply1

Roth IRA

With a Roth IRA, your contributions are taxed up front, meaning you won’t pay taxes on your money when making qualified distributions during retirement. If you expect to have a higher tax rate at retirement, or if your current tax rate is low, this option may be a better fit for you.

Account Summary

  • Contribute up to $7,000 of earned income per year, or $8,000 if you're 50 and over1
  • Contributions are not tax-deductible1
  • Funds can be withdrawn without penalty once you reach the age of 59½, or before that subject to a 10 percent penalty unless exceptions apply1
  • No requirement to take a minimum distribution at age 732
  • Anyone with earned income is eligible
  • Roth IRAs cannot be converted to Traditional IRAs1

1 Certain qualifications apply. Consult your tax advisor for more information.

2 Effective for customers turning 72 after December 31, 2022.