Americans Highly Concerned with Living Comfortably Through Retirement, Ally Bank Survey Finds
Expanded IRA contribution limits and customized retirement products offer increased opportunities for savings in early 2013
Feb 19, 2013
MIDVALE, Utah, Feb. 19, 2013 -- According to an Ally Bank survey of more than 1,000 Americans, living comfortably through retirement tops the list of concerns when it comes to specific financial anxieties (37 percent). Retirement fears far outpaced other commonly cited financial woes, including paying for personal (14 percent) or children's (13 percent) tuition and funding parents' elderly care (9 percent).
One of the keys to living comfortably in retirement is to start early, says Diane Morais, Ally Bank Deposits and Line of Business Integration executive.
"For example, an IRA customer who saves $6,000 a year starting at age 50 and earns 3 percent annually will have about $71,000 at age 60," Morais said. "Compare this to an IRA customer who saves $2,000 a year starting at age 30 and earns 3 percent a year, who will have about $98,000 at age 60. Even though both customers saved the same amount, the early saver's IRA is worth $27,000 more due to the advantages of compounding interest over a longer period of time."
Demand for Ally Bank IRA products peaks during the first few months of each year as Americans gather financial records in preparation for filing their tax returns and re-evaluate their retirement savings goals. Furthermore, the IRS announced in October 2012 that the limit on contributions to Traditional and Roth IRAs would rise for the first time since 2008, from $5,000 to $5,500, and individuals 50 years and older can contribute an additional $1,000.
"The next couple of months will be ideal for opening IRAs as contributions made in this timeframe could be counted on 2012 tax returns," Morais said. "Existing savers looking for secure retirement savings growth may want to consider rolling over their current retirement plans to an IRA."
Ally Bank's IRAs and Retirement Products
Ally Bank's retirement savings portfolio includes an IRA Online Savings Account and a range of IRA CDs with competitive interest rates. The products offer many of the same customer-friendly features and services that Ally Bank customers are accustomed to: Raise Your Rate CDs, no monthly maintenance fees, no minimum deposits to open and FDIC insurance to the maximum allowed by law. In addition to offering consistently competitive rates on its IRA products, Ally Bank compounds interest daily, a feature that will help consumers' money grow faster and that many other banks don't offer.
"For consumers especially concerned about retirement readiness, Ally Bank offers a suite of simple and straightforward retirement products that will help them get closer to their retirement savings goals," said Morais.
Ally Bank offers three different IRA plans: the Traditional, Roth and Simplified Employee Pension (SEP) plans, which are each available for the following products:
- IRA Raise Your Rate CD (in two-year and four-year terms)
- With Ally Bank's IRA Raise Your Rate CD, consumers can increase their interest rate once (for a two-year CD) or twice (for a four-year CD) if the Bank's rates on these CDs go up at any time during the CD's term.
- IRA High-Yield CD (in three-month, six-month, nine-month, 12-month, 18-month, three-year and five-year terms)
- With our Ally Ten Day Best Rate Guarantee, when consumers renew an IRA CD they automatically get the best rate we offer within ten days beginning with the CD renewal date.
- IRA Online Savings Account.
- Earn a higher rate than with a traditional savings account.
Customers looking for secure growth can also roll over existing IRAs or qualified retirement plans, such as a 401(k) or 403(b), into an Ally Bank IRA. Before deciding on the right IRA plan, consumers are advised to consult with a tax professional.
For more information about Ally Bank's IRAs, visit http://www.ally.com/bank/ira.
Consumers can visit http://www.ally.com/bank/ira/compare to view Ally Bank's IRA plan options and determine which best suits their needs, based on contribution eligibility, maximum contribution limits, tax advantages, tax deductions, distributions and annual deadlines for contribution.
By clicking the "Compare IRA CDs & Savings" tab, consumers are able to view current Annual Percentage Yields, top competitor rates, product highlights and additional details.
A combined landline and cell phone survey was conducted by Opinion Research Corporation among a national probability sample of 1,022 adults comprising 510 men and 512 women 18 years of age and older, living in the continental U.S. Interviewing was completed during the period of June 28 to July 1, 2012.
About Ally Bank
Ally Bank is a direct bank in the U.S. that offers a straightforward approach to banking with no minimum deposit required to open an account, no monthly maintenance fees and 24/7 live customer service. A subsidiary of Ally Financial Inc., the Bank offers online savings, interest checking, money market accounts, certificates of deposit with terms ranging from three months to five years, and IRA Plans and products. Member FDIC.