Washington Trust Bank

Retirement planning is not only smart—it is essential. For many people Social Security and work pensions will only be one part of a financially secure retirement and personal savings plan.


Individual Retirement Accounts (IRAs) were created by the federal government to encourage individuals to save money for retirement. IRAs also provide the added benefit of an interest bearing investment with the potential for tax deductibility, special tax-deferred benefits, or tax-free earnings.

Here are some of the savings tools Washington Trust Bank offers to help develop a more sound retirement plan.

Who can contribute?

Anyone with earned income

Depends on modified adjusted gross income (MAGI)

How much can be contributed a year?

Under age 50: Up to $5,500
Over age 50: Up to $6,500

Under age 50: Up to $5,500
Over age 50: Up to $6,500

How does the account grow?

Tax-deferred growth

Tax-free earnings

When can withdrawals begin without penalties?

When owner is 59½ years old

Once a Five Year holding period has been met along with other guidelines

Are the contributions deductible?

All or part of the contribution is—if you qualify

Contributions are never deductible

When is federal income tax due?

Due upon withdrawal of earnings and deductible contributions

No Federal income tax

How long can contributions be made?

Up to age 70½

As long as income is earned—even after age 70½

When does the IRA need to be distributed by?

By age 70½

Does not have a mandatory distribution age

*Beginning in 2009, the contribution limits are subject to Cost-of-Living (COLA) adjustments. Additionally, if you have attained age 50½ or older by the end of your taxable year, you are eligible to make catch-up contributions.

Your selection depends on a few factors—for example: age, income and whether you're investing in an employer plan. Get started saving for retirement now—no matter what stage of life you are in.