IRA Certificates vs. Certificates

IRA Certificates vs. Certificates

Individual retirement account (IRA) certificates and certificates are usually lumped together when discussing certificates, but do you know the difference between the two? Here’s a guide to help differentiate between the two and determine which account best suits your needs. Always consult with a tax advisor to understand how an IRA or a certificate may impact your specific financial situation.

Certificates are savings accounts that pay interest for a certain amount of time (known as a term), while IRA Certificates are certificates that offer tax benefits. The main difference between certificates and IRA Certificates is that IRA Certificate holders do not have to pay taxes on any interest earned until the funds are withdrawn (typically after retirement when the investors' current income is lower), whereas certificate holders have to report any dividends received. 

If you're planning to retire soon or have already retired, an IRA Certificate is a preferred investment over a traditional certificate.

View our current certificate rates below.