As a finance expert, I often get asked about retirement plans offered by regional banks like Associated Bank. Many people assume all retirement plans work the same, but the details matter. In this guide, I break down Associated Bank’s retirement options, compare them to alternatives, and show you how to maximize your savings.
Table of Contents
Understanding Associated Bank’s Retirement Plan Offerings
Associated Bank provides retirement plans primarily for its employees, but it also offers Individual Retirement Accounts (IRAs) and 401(k) rollover services for customers. The bank itself does not sponsor 401(k) plans for non-employees, but it partners with third-party providers to facilitate retirement investments.
Types of Retirement Accounts Available
- Traditional IRA – Contributions may be tax-deductible, and earnings grow tax-deferred until withdrawal.
- Roth IRA – Contributions are made after-tax, but withdrawals in retirement are tax-free.
- 401(k) Rollovers – If you have an old 401(k) from a previous employer, Associated Bank can help transfer it into an IRA.
Contribution Limits and Tax Benefits
For 2024, the IRS sets the following contribution limits:
- Traditional & Roth IRA: \$7,000 (or \$8,000 if age 50+).
- 401(k): \$23,000 (or \$30,500 with catch-up contributions).
The tax benefits depend on your income. For example, if you contribute \$7,000 to a Traditional IRA and fall in the 22% tax bracket, you could reduce your taxable income by:
\$7,000 \times 0.22 = \$1,540Associated Bank vs. Competitors
| Feature | Associated Bank IRA | Fidelity IRA | Vanguard IRA |
|---|---|---|---|
| Account Fees | Moderate | Low | Low |
| Investment Options | Limited | Extensive | Extensive |
| Customer Support | Local branches | 24/7 online | Phone/online |
While Associated Bank provides personalized service, its investment options may not be as diverse as those at major brokerages.
How to Maximize Your Associated Bank Retirement Plan
1. Start Early and Leverage Compound Interest
The earlier you invest, the more time your money has to grow. For example, if you invest \$5,000 annually at a 7% return:
FV = P \times \frac{(1 + r)^n - 1}{r}Where:
- P = \$5,000
- r = 0.07
- n = 30 years
Your future value ( FV ) would be:
FV = 5,000 \times \frac{(1.07)^{30} - 1}{0.07} \approx \$505,3652. Diversify Your Investments
Associated Bank offers mutual funds and ETFs, but you should ensure proper diversification. A balanced portfolio might include:
- 60% Stocks
- 30% Bonds
- 10% Real Estate (REITs)
3. Consider a Roth Conversion if Beneficial
If you expect higher taxes in retirement, converting a Traditional IRA to a Roth IRA could save you money. The conversion amount is taxable, but future withdrawals are tax-free.
Common Mistakes to Avoid
- Early Withdrawals – Taking money out before 59½ incurs a 10% penalty.
- Ignoring Employer Matches – If your employer offers a 401(k) match, contribute enough to get the full match—it’s free money.
- Overlooking Fees – High expense ratios can erode returns. Compare Associated Bank’s fees with low-cost providers like Schwab or Vanguard.
Final Thoughts
Associated Bank’s retirement plans are solid for those who prefer local banking relationships. However, if you seek a wider range of investment choices, national brokerages may be better. The key is to start early, contribute consistently, and optimize for tax efficiency.
