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IRA individual retirement account written on wooden cubes.

Why an IRA share certificate is a safe bet for retirement

When planning for retirement, it's hard to know where to put your money, especially in light of stock market volatility. Stocks, bonds, mutual funds: they can yield great results or vanish overnight. That's why many people are turning to IRA share certificates for a secure, guaranteed rate of return.

Whether you are affluent and experienced, a conservative investor or a young professional just getting into retirement planning, IRA share certificates offer attractive benefits and should be at the top of your list for a secure method of investing.

A share certificate is the same as a certificate of deposit, but credit unions call them by a different name, according to Member One Federal Credit Union. A certificate of deposit account is designed to earn interest over a preset time, and an IRA share certificate works much the same with some added benefits.

Low risk

Some retirement programs rely on the market for gains, but IRA share certificate interest rates are not subject to what happens — or doesn't happen — on Wall Street. In fact, most IRA share certificate programs increase your interest rate of return as you continue to add to the account.

While many retirement accounts are plagued by fees, especially if a big brokerage firm is managing them, IRA share certificates from a credit union generally don't have fees, unless you choose to tap into your account before the predetermined maturity date.

Because IRA share certificates are issued by credit unions, your account is insured by the National Credit Union Association for up to $250,000.

Tax benefits

Another perk of investing in an IRA share certificate is the tax advantage it provides. Just like a regular IRA account, IRA share certificates are available in Roth or traditional formats.

With a Roth IRA, withdrawals are tax-free after a certain age. You just aren't allowed to deduct contributions from your current income for tax purposes.

With traditional IRAs, you can deduct contributions you make to the account every year on your tax return, according to IRS limitations. Any income on the shares is not taxed until you withdraw the money later in life.

"If you expect your tax rate to be higher in retirement, choose a Roth IRA and its delayed tax benefit," reports Nerdwallet. "If you expect lower rates in retirement, choose a traditional IRA and its upfront tax advantage."

There are advantages and disadvantages to each, and early withdrawal penalties may apply to either program.

Individually owned

You can open an IRA share certificate yourself, regardless of what your employer offers or even whether you're employed. This makes it an attractive option if you contribute the maximum amount allowed to a 401k or if you're not eligible for a program at work. After all, an IRA is an Individual Retirement Account, meaning the account is yours alone.

IRA share certificates are easy to set up and usually have low initial contribution requirements, according to Nerdwallet. This makes them a good option for anyone looking to invest, including people who have never opened a retirement account.

Member One Federal Credit Union offers IRA share certificates that will earn a high yield with low minimum balance requirements, have competitive rates, and provide a variety of terms and investment options. For more information and to set up your IRA share certificate, contact the experts at Member One Federal Credit Union

Jason Bell is a graduate of the University of Utah and works as a full-time educator. He enjoys automotive consulting, as well as spending time with his wife, family, friends, and cars. Contact him at