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IRAs & HSAs

Save for Your Health and Retirement

Health Savings Account (HSA)

High deductible health plans and medical expenses require forethought to avoid a big hit to the budget should medical needs arise.  Plan ahead and start saving now with a health savings account at Cherokee State Bank.


HSA Advantages and Benefits

With an HSA you get protection against high or unexpected medical bills, the flexibility to be able to save for current or future medical needs and complete control over the account. An HSA is also portable. If you change employers or insurance carriers, you take your HSA with you. The funds will remain in the account from year to year, just like an IRA, with no “use it or lose it” rules. Contributions to this account are also 100% tax deductible, including tax-free earnings through investment and tax-free withdrawals for qualified medical expenses. 


HSA Eligibility

To be eligible for an HSA, you must be covered under a high-deductible health plan (HDHP). Ask an Cherokee State Bank expert for the current minimum deductibles. You can’t also be covered by any other health plan that is not an HDHP, you can’t be enrolled in Medicare and you cannot be claimed as a dependent on another person’s tax return. 


Contribution Limits

There are annual contribution limits established every year by the Internal Revenue Service (IRS). The maximum annual contribution amount is generally the less of 100% of the annual deductible under the HDHP or a specified amount. Limits are subject to change – ask a Cherokee State Bank expert for the current amount allowed when you apply. Annual out-of-pocket health expense limits are also subject to change – ask an associate for the current limits on single and family coverage.  


Eligible Expenses

You can use the money in your HSA to pay for any qualified medical expense permitted under federal tax law. In general, this includes most medical, dental, and vision expenses, but not your insurance premium, unless you are unemployed and collecting federal unemployment benefits. For a list of eligible expenses provided by the Internal Revenue Service, please go to www.irs.gov/pub/irs-pdf/p502.pdf.

You can use the money in the account to pay for medical expenses for yourself, your spouse, or your dependent children. You can pay for expenses for your spouse and dependent children even if they are not covered by your HDHP. 


How do I open my HSA?

  • Enroll in an HSA Qualified high-deductible health plan (HDHP) with an insurance carrier of your choice.
  • Stop by Cherokee State Bank to open your HSA.

HSA Account details

  • $50 minimum to open
  • No minimum balance required
  • $25 set-up fee
  • Simple enrollment
  • Knowledgeable customer service assistance
  • Self & employer contributions
  • Unlimited check writing privileges
  • Online Banking account access
  • Competitive account rates
  • FDIC insured account
  • Monthly E-statements ($2 paper statements)
  • All monthly statement available for Year-end IRS reporting, $10.00 plus tax
  • $25 Termination Fee

IRAs (Individual Retirement Accounts)

It pays to plan ahead. There are so many things to consider when thinking about your retirement. We can help you get the retirement you want. Our team can share with you how an IRA can be an essential part of your retirement. These tax advantaged accounts can help you save for the future. Let our knowledgeable financial experts tell you more about these accounts to help you set up the account that's right for you.


Traditional IRA – Anyone with income and under the age of 70½, can open a traditional IRA.

  • The 2016 contribution limit is $5,500 with an extra $1,000 catch-up contribution limit for individual age 50 and older1
  • Contributions are tax deductible*
  • Interest earnings are tax deferred
  • Withdrawals can begin at age 59½
  • Early withdrawals subject to penalty**
  • Mandatory withdrawals begin at age 70½
  • $1000 minimum to open
  • No maintenance fees
  • FDIC insured

*Consult with your tax advisor.
** Certain exceptions apply, such as healthcare, purchasing first home, and others.


Roth IRA – The Roth IRA is a retirement investment option that if used correctly can result in a tax-free retirement. You must earn less than $117,000 to fully contribute to a Roth IRA ($184,000 for joint return).

  • The 2016 contribution limit is $5,500 with an extra $1,000 catch-up contribution limit for individuals age 50 and older1
  • Contributions are not tax deductible
  • Earnings are 100% tax free upon withdrawal
  • Direct contributions can be withdrawn free of penalty at any time*
  • Early interest withdrawals subject to penalty**
  • No mandatory withdrawals at age 70½
  • $100 minimum to open
  • No maintenance fees
  • FDIC insured

*Consult with your tax advisor.
** Certain exceptions apply, such as healthcare, purchasing first home, and others.


The Coverdell Education Savings Account (formerly called Education IRA) provides tax-free earnings when the funds are used for a child's education expenses, such as college.

  • Interest grows tax free
  • Withdrawals are tax free when used for qualified education expenses*
  • Contributions are not tax deductible
  • No income restrictions or limits to open
  • Beneficiary must be under 18 at time of opening
  • Beneficiary does not have to be a relative
  • Mandatory distributions begin if balance remains when beneficiary reaches age 30
  • Maximum annual contribution of $2,0001
  • No maintenance fees
  • FDIC insured

*Qualified expenses include tuition and fees, required books, supplies and equipment and qualified expenses for room and board.


A Simplified Employee Pension (SEP) plan allows employees and employers to contribute to traditional IRAs set up for employees. It is ideally suited as a start-up retirement savings plan for small employers not currently sponsoring a retirement plan. A SEP-IRA account follows the same investment, distribution, and rollover rules as traditional IRAs.

  • Max. Contributions is $53,000 or 25%  of participant compensation1
  • Must be age 21 or older and have worked 3 of the last 5 years with company
  • Interest earnings are tax deferred
  • Withdrawals can begin at age 59½
  • Early withdrawals subject to penalty
  • Mandatory withdrawals begin at age 70½
  • $1000 minimum to open
  • No maintenance fees
  • FDIC insured

1Annual Contribution limits are set annually by the Internal Revenue Service (IRS).

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