IRAs can be confusing and even seem unnecessary to talk about for some, especially if retirement still seems lightyears away. Allow us to answer some of the most common questions people have about IRAs:

Q: Am I allowed to contribute to an IRA if I have a retirement plan through work?

A: Yes, as long as you meet the IRA’s eligibility requirements ‐ even if you participate in a 401(k) plan at work.

Q: What is the contribution limit?

A: The contribution limit is annual, so the amount you are allowed to contribute can change from year to year. For 2019, 2020 and 2021 it is $6,000 (or $7,000 if you’re age 50 or older). Your contribution limit might also change based on your income and filing status.

Q: What’s the difference between a Roth IRA and a Traditional IRA?

A: The main difference is that with a Roth IRA you contribute after‐tax dollars, so your money grows tax‐ free. A Traditional IRA, on the other hand, includes contributing pre‐tax dollars so withdrawals are taxed.

Q: How do I know if either a Roth or Traditional IRA is better suited for me?

A: If you expect to be in a higher tax bracket when you start taking withdrawals, a Roth IRA is best. If you expect to be in the same or lower tax bracket when you start taking withdrawals, a Traditional IRA is best. We recommend consulting with your tax advisor to determine which IRA option is the right choice for you.

Q: What are the penalties for withdrawals?

A: In most cases, withdrawing IRA contributions is penalty‐free, but if you withdraw earnings from an IRA, you may owe income tax and a 10% penalty.

Q: What is a spousal IRA?

A: People often wonder what they can do in a situation where there’s a working spouse and a non‐ working spouse. A spousal IRA allows the employed spouse to contribute to an IRA of the non‐working spouse. This can as much as double the family’s retirement savings.

Q: Can I contribute to an IRA if I only work part time?

A: Yes, it doesn’t matter if you’re a teenager working a summer job or have worked your whole life and are officially retired – you can still contribute to an IRA.

Q: What is a Roth conversion?

A: A Roth conversion allows you to withdraw from a 401(k) or a traditional IRA and convert it to a Roth IRA. This is smart for individuals who want their money to grow tax‐free.

We’ve only just scratched the surface of what there is to know about IRAs, but we’re always here to help if you have further questions. Contact us or visit our website to learn more about IRAs and how they can be beneficial to your financial future.

Peoples Bank & Trust Co.

Member FDIC

Equal Housing Lender

Bob Hall was honored for his 48 years of service on the Peoples Bank & Trust Co. Board of Directors at the company Christmas party on December 4th. He will be retiring from the Board of Directors at the end of 2021.

Hall joined the board in 1973, and during his tenure oversaw the expansion of Peoples Bank & Trust from Hawk Point into Troy as well as the addition of 10 other branches throughout Lincoln, Pike and St. Charles Counties.

“The total asset size of Peoples Bank & Trust was $10 million when I joined the board and today it is over $700 million,” said Hall. “I am thankful for my time with this great organization, and I look forward to seeing continued success from Peoples Bank.”

In addition to Hall’s service to Peoples Bank & Trust, he also served on the board of Lincoln County Bancorp and was Chairman of the Board of Exchange Bank of Northeast Missouri.

Outside of his role as director, Bob is the President of Hall Enterprises and can be found most days working at Hall Trailer Sales. He’s an active member of the Troy community having held the positions of President for the Kiwanis and Troy Chamber of Commerce as well as a served as an Alderman for the City of Troy and member of the Lincoln County R-3 School Board. Bob is an active member of the Troy Rotary Club and can be heard regularly on the local radio stations announcing the Troy Trojan Basketball games where he has lovingly been given the title of “Mr. Trojan Basketball.”

“Those of us that know Bob personally admire him not only for his business efforts, but also for his personal lifetime values as a devoted family man and member of this community” said Justin St. Pierre, President/CEO of Peoples Bank & Trust. “I wish Bob well and am confident the community will continue to benefit from his valued leadership.”