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  Personal Savings Accounts

We offer three personal savings accounts to choose from—a general account and two specialized accounts.

Our Personal Savings Account Options

 

Regular Savings

A variable-rate account with a low minimum balance requirement to help you start a savings program.

Benefits

• You can get started saving with a small opening deposit.
• This account offers high liquidity so you can access funds easily if an unexpected need arises, and usually without penalty.
• Can be used as an Overdraft Protection account.

 

Features

• Minimum deposit to open: $100
• Up to six free withdrawals/transfers each month and unlimited deposits
• Free ATM or Visa® Check Card
• Free Online Banking and telephone banking access
• Make it easy to save regularly by setting up automatic transfers from your APB checking to your Regular Savings account.
• Funds in a Coverdell Education Savings Account can be invested in a Regular Savings account.
• Funds in an IRA can be invested in a Regular Savings account.

 

Interest Information

• Earn interest: the interest rate and annual percentage yield (APY) are subject to change at any time without notice.
• Interest is calculated daily and is compounded monthly.
• Fees could reduce the earnings on the account.
• Earn interest on your daily balance.
•
Regular Savings Interest Rate * Annual Percentage Yield *
Daily Balance 0.35% 0.35%

 

Fees

• Account is free with minimum daily balance of $300 or if you are a minor under 18 years of age.
• $3.00 monthly service fee if daily minimum balance falls below $300.
• A $1.00 excess withdrawal fee will apply.
• Local sales tax may apply to service charges and fees.

 

Coverdell Education Savings Account (ESA)

A Coverdell Education Savings Account (ESA) is a convenient way to begin saving money for higher education expenses down the road.

Benefits

• If the funds are used for qualified education expenses, the earnings on your ESA are usually tax free.
• There are no set up or annual maintenance fees.
• You have the flexibility of investing your ESA funds in several APB accounts.
• You can use ESA funds for education expenses for elementary school through college and vocational school (public, private or parochial).

 

ESA Features

•

You can choose to fund an ESA plan with any of these accounts:
• Minimum deposit to open: $100 for savings option, $500 for the Gold Minor Educational CD, or $2,000 for our Regular CD option.
• Distributions that are used to pay qualified education expenses are generally tax and penalty free.
• Contributions can be made up until the day before the child’s 18th birthday. This age limit is extended for special-needs children.
• The deadline for contributions is the tax return deadline, normally April 15, even if you file for an extension.
• You may want to consult your tax advisor before opening a Coverdell ESA.

 

ESA Contribution Information

• ESA contributions are not deducted from your tax return. The interest earned, however, is tax-free, as long as it is spent on qualified educational expenses.
• Contributions and distributions are subject to IRS rules. Total contributions to an ESA cannot exceed the maximum allowed per tax year, which is usually $2,000. No child can receive more than this amount, from all sources, without incurring IRS penalties.
• There are IRS penalties if withdrawals are made for non-educational expenses.
•

Qualified educational expenses include:

  • Books and school supplies
  • Education-related equipment
  • Uniforms
  • Room and board
  • Tuition and fees
• You can use HOPE or Lifetime Learning tax credits and ESA distributions in the same tax year as long as the funds are not used for the same expenses.
• Permanent Fund Dividends and other unearned income can be used for contributions to an ESA.

 

Can You Contribute to an Education Savings Account?

• Probably, because almost anyone! You and the child do not have to be related in order to make a contribution to an Education Savings Account.
•

Whether or not you can contribute does depend on your modified adjusted gross income (MAGI). Single filers with MAGI above $110,000 and married/joint filers with MAGI above $220,000 cannot contribute to this type of account.

Single Filer Income Tax Return
Less than $95,000—full contribution
$95,000-110,000—partial contribution
$110,000+—no contribution allowed

Married/Joint Income Tax Return
Less than $190,000—full contribution
$190,000-$220,000—partial contribution
$220,000+—no contribution allowed
• An entity (a corporation or tax-exempt organization, for example) can contribute to an ESA as well. There are no income limitations for businesses.

 

Important Facts About ESA Rollovers

• If more than one child in your family has an ESA, but does not use all of the funds, they can be rolled over to another ESA account.
• An Education Savings Account can only be rolled over into another Education Savings Account for another qualified family member.
•

For an ESA, a family member is defined any one of the following:

  • A designated beneficiary’s child or stepchild
  • A designated beneficiary’s brother, sister, stepbrother, or stepsister
  • The father, mother, stepfather, stepmother of the designated beneficiary
  • A son or daughter of the designated beneficiary’s brother, or sister (niece or nephew)
  • The designated beneficiary’s son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law
  • A spouse of any of the individuals named above or the first cousin of such beneficiary.
• Rollovers must be completed within 60 days of the distribution.

 

Interest Information

• Interest is based on the type of account you invest your Coverdale ESA in (see CDs and Regular Savings accounts).

 

Fees

• There are no set up or annual maintenance fees.

 

 

Health Savings Accounts

For Customers with High-deductible Health Coverage
Our Health Savings Account is a great option for better managing your medical expenses.  It offers convenient access as well as many long-term financial benefits.

Health Savings Accounts, coupled with a high-deductible health plan (HDHP), can be a great option for individuals who are self employed and are searching for a way to purchase affordable insurance on their own. It can also be a way for businesses to begin offering or continue offering medical coverage for employees as medical expenses continue to soar. 

Benefits of a Health Savings Account

• You can earn interest, tax free, on money you’re saving for medical care.
• HSAs provide you with tax savings because when you contribute your own funds to your HSA, your taxable income is reduced by the amount of the contribution.
• You can roll over unused HSA funds from year-to-year, and you retain ownership of the account even when you change jobs.
• The money you set aside in your HSA, and don’t use, grows tax-deferred.  When you reach the age of 65, you can continue to use the funds, tax-free, for medical expenses, but you also have the option of withdrawing funds, penalty free, for any purpose and paying taxes on those funds at your normal tax rate.
• You can order a separate HSA Visa® Check Card that you can easily identify as a Health Savings Account access card.
• You will receive separate checks to access your HSA for easier, more accurate recordkeeping.

 

HSA Features

• Money deposited into your HSA, as well as the interest you earn, can be withdrawn tax-free when used to pay qualified medical expenses.
•

You must meet certain qualifications stipulated by the federal government in order to open and contribute to an HSA:

  • You must have a qualified high-deductible health plan (HDHP).
  • Generally, you cannot be covered under any health plan that is NOT an HDHP (exceptions include insurance that covers accidents, disability, dental care, vision care, long-term care, and certain other “permitted” insurance).
  • You cannot be enrolled in Medicare.
  • You cannot be eligible to be claimed as a dependent on another person’s tax return.
•

A health plan is considered a qualified HDHP if it satisfied both an annual deductible and a maximum out-of-pocket requirement.

Year Annual Deductible Annual Out-of Pocket Costs
Individual:    
2007 $1,100 or more Maximum of $5,500
2008 $1,100 or more Maximum of $5,600
Family:    
2007 $2,200 or more Maximum of $11,000
2008 $2,200 or more Maximum of $12,000

 
• A broad range of medical expenses are covered under HSA regulations. They are outlined in the IRS publication 502, which can be accessed from our web site.
• If HSA funds are withdrawn for non-medical purposes, those funds will not only be taxable, but they will also be subject to a 10% penalty in most cases.  Exceptions are made if you become disabled or reach the age of 65.
• Minimum opening deposit:  $0
• A special, free Health Savings Visa® Check Card is available so you can pay medical expenses conveniently.
• You will receive separate checks for your Health Savings Account, so you can keep track of all account expenditures.
• Free Online Banking access.
• Monthly account statement.

 

Important Facts About HSA Contributions

•

You, your employer, and/or another individual can make contributions to your HSA, but the total contribution cannot exceed the allowable amount.

Year Maximum Annual Contribution
Individual:  
2007 $2,850
2008 $2,900
Family:  
2007 $5,650
2008 $5,800

 
• A one-time contribution can be made from your IRA, up to the allowable maximum annual contribution.
• If you become eligible for an HSA at any time during the year, you can make the full-year contribution as long as you remain eligible through the following calendar year.

 

Catch-up Contributions

• Individuals who are 55+ years and who meet the other qualifications for contributing to an HSA, are eligible to make additional catch-up contributions.
• Catch-up contributions are allowable, each year you remain eligible for the account.
•

If both spouses are eligible, both may make catch-up contributions.

Year Maximum Catch-up Contribution
2007 $800
2008 $900
2009 $1,000

 

Interest Information

• The interest rate and annual percentage yield (APY) are subject to change at any time without notice.
• Interest is calculated daily and is compounded monthly.
•
Average Daily Balance Interest Rate Annual Percentage Yield
$0-2,999.99 1.00% 1.00%
$3,000-9999.99 1.98% 2.00%
$10,000-24,999.99 2.47% 2.50%
$25,000-49,999.99 2.72% 2.75%
$50,000+ 2.96% 3.00%

                 

Fees

• There is a monthly fee of $3.00 for daily balances below $3,000.
• There are no set up fees, per-item fees, or annual maintenance fees.
• We don’t charge you a fee for accessing ATMs with your HSA Visa Check Card, unless you use our ATM in Hoonah.  If you use a non-Alaska Pacific Bank ATM, you may be charged a fee by that ATM provider.

 

More Information

Download the document, All About HSAs, produced by the U.S. Treasury Department, for additional technical information about Health Savings Accounts. We also encourage you to call us or stop by so we can answer your questions.



* Rates quoted are effective as of 05/14/08. Posted interest rates and Annual Percentage Yields are subject to change at any time without notice.
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