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IRAs, or Individual Retirement Accounts, are long-term accounts that help you save for retirement. IRA CDs allow you certain tax advantages and help you safely save your money with stable financial returns. The sooner you open an IRA CD, the more you will save over time. There are 2 types of IRA CDs that you can choose from, Roth IRAs and Traditional IRAs, and they both have their own advantages and disadvantages. Here are a few steps on how to open up an IRA CD.


  1. 1
    Decide what type of IRA CD you want to open. There are typically 2 types of IRA CDs, Roth IRAs and Traditional IRAs.
    • Roth IRAs do not have an age limit on contributions. On Roth IRAs, you pay the tax now and then receive tax free withdrawals later. There are income limits on Roth IRAs, so that if you are a single or married person and earn over a certain amount of money, you are not allowed to contribute to your Roth IRA.
    • Traditional IRAs have a contribution age limit of 70 1/2. With Traditional IRAs, you receive a tax deduction now and pay tax later. There are not typically any limitations on income when you do not have a pension plan, but if you earn over a certain amount of money you may not be able to receive a tax deduction.
  2. 2
    Research opening an IRA CD through various different financial institutions. You may receive certain advantages if you open an IRA CD at your current financial institution or another, so check out a few to see where you will receive the best agreement.
  3. 3
    Check the current rates and restrictions on IRA CDs. Most IRA CDs have certain limitations, fees and restrictions, which may or may not be beneficial to you. Make sure you are aware of all of the terms before you open an IRA CD.
  4. 4
    Acquire the necessary funds you will need to start your IRA CD. There is a minimum to open IRA CDs, but the minimum amount varies depending on the IRA that you choose. Typically, the minimum can range from $50 to $2,000.
  5. 5
    Access your online bank account if you decide to open an IRA CD at a bank where you are already a customer. You can usually open an IRA CD online through your account if you are already a customer. In this case, your IRA CD account may be linked to your savings account so that you can transfer the funds easily in the future.
  6. 6
    Visit the financial institution with which you want to open an IRA CD. If you are not already a customer of the bank, you should speak with a representative that can help you open an IRA CD and explain the terms to you.

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Categories: Retirement

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