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Traditional IRAs

A Traditional IRA is an individual investment account with tax-deferred growth and potentially tax-deductible contributions. This means choosing to invest in:

  • Mutual funds
  • Stocks and bonds
  • Exchange-traded funds
  • Bank savings products

Your investments then grow without the gains taxed until the funds are withdrawn in retirement, though early withdrawal can bring higher penalties. The most you can contribute each year through age 49 is $6,000. If you’re 50 or older, it’s $7,000.

Roth IRAs

A Roth IRA is also an individual investment account, but it differs from a Traditional IRA in a couple of important ways:

  • Contributions to Roth IRAs are not tax deductible
  • Retirement withdrawals are tax-free

The most you can contribute each year through age 49 is $6,000. If you’re 50 or older, it’s $7,000.

And where a Traditional IRA would penalize you for early withdrawal (to up 10%!) and would be taxed at your current income rate, a Roth allows you to withdraw contributions (not earnings) any time without penalty or income taxes.

Planning Ahead

Deciding which type of IRA is right for you depends on your current situation. Some people can benefit from upfront tax break a Traditional IRA brings, while others prefer to know they won’t be taxed in retirement.

Everyone’s situation is different, and for many, retirement can feel like an impossibility. Learning how you can invest in yourself and your future can turn that into a possibility – everyone has to start somewhere.

A+ Tip: The Affinity Plus Investment Representatives can advise you on your specific situation, and provide guidance for all kinds of future plans.

Check the background of your financial professional on FINRA's BrokerCheck.


Representatives are registered, securities sold, advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC , a registered broker/dealer and investment advisor, which is not an affiliate of the credit union. CBSI is under contract with the financial institution to make securities available to members. Not NCUA/NCUSIF/FDIC insured, May Lose Value, No Financial Institution Guarantee. Not a deposit of any financial institution.  CBSI is a registered Broker/Dealer in all fifty states of the United States of America.

This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.
Contributions to a traditional IRA may be tax deductible in the contribution year, with current income tax due at withdrawal. Withdrawals prior to age 59 ½ may result in a 10% IRS penalty tax in addition to current income tax.
A Roth IRA offers tax deferral on any earnings in the account. Qualified withdrawals of earnings from the account are tax-free. Withdrawals of earnings prior to age 59 ½ or prior to the account being opened for 5 years, whichever is later, may result in a 10% IRS penalty tax. Limitations and restrictions may apply.

Investment Center Disclaimer

Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. Affinity Plus Federal Credit Union and Affinity Plus Investment Center are not registered as a broker-dealer or investment advisor. Registered representatives of LPL offer products and services using Affinity Plus Investment Center and may also be employees of Affinity Plus Federal Credit Union. These products and services are being offered through LPL or its affiliates, which are separate entities from, and not affiliates of, Affinity Plus Federal Credit Union or Affinity Plus Investment Center. Securities and insurance offered through LPL or its affiliates are:

Not insured by NCUA or Any Other Government Agency

Not Credit Union Guaranteed

Not Credit Union Deposits or Obligations

May Lose Value

The LPL Financial registered representative(s) associated with this website may discuss and/or transact business only with residents of the states in which they are properly registered or licensed. No offers may be made or accepted from any resident of any other state.

Your Credit Union (“Financial Institution”) provides referrals to financial professionals of LPL Financial LLC (“LPL”) pursuant to an agreement that allows LPL to pay the Financial Institution for these referrals. This creates an incentive for the Financial Institution to make these referrals, resulting in a conflict of interest. The Financial Institution is not a current client of LPL for brokerage or advisory services.

Please visit https://www.lpl.com/disclosures/is-lpl-relationship-disclosure.html for more detailed information.