Opening an IRA is an important decision. To help, here is our survey of the best IRA accounts for 2018, including fees and features of each option.
Just about every bank, investment brokerage, and robo-advisor welcomes Individual Retirement Accounts (IRAs). But there are a handful of institutions that stand out above the rest. Below are seven of the best places to open an IRA.
Ally Invest may very well be the overall best place to open an IRA. Not only do they offer nearly unlimited investment options, but they also have one of the very lowest fee structures in the industry.
You can trade exchange traded funds (ETFs) at $4.95 per trade and mutual funds at $9.95 per trade. They also offer volume trading discounts for high-frequency traders. They charge a $50 annual fee, but that only applies to accounts with less than a $2,500 balance and no activity for the past 12 months.
In addition to self-directed trading, they also offer Ally Invest Managed Portfolios, which is a robo-advisor service. It requires a minimum investment of $2,500 and has an annual fee of 0.30%. But it provides you with the option to have some or all of your retirement portfolio professionally managed.
Ally Invest is also the first cousin of Ally Bank, the online bank that offers some of the highest interest rates on savings and CDs available anywhere.
With all that Ally Invest has to offer–investment options and low fees–you can’t go wrong with this platform.
Similar to Ally Invest, E*TRADE offers an outstanding mix of almost unlimited investment options. It also features low pricing. You can trade stocks and ETFs at $6.95 per trade, though mutual fund trades are a bit on the high side, at $19.95. However, they offer more than 1,000 mutual funds that are both no-load and no fee. And for what it’s worth, they have 30 brick-and-mortar locations scattered about the country.
E*TRADE has no minimum account balance and no annual fee to worry about.
E*TRADE also has a managed portfolio option–E*TRADE Adaptive Portfolio. This is E*TRADE’s robo-advisor entry, and it requires a minimum initial investment of $5,000. The annual management fee is 0.30%. Once again, this gives you the option to have at least some of your portfolio professionally managed. But you can still go the DIY route with the rest of your money.
One of the original discount investment brokerage firms, Charles Schwab has all the advantages of a traditional full-service brokerage firm. But their fee structure competes with those of discount brokerages.
You can trade stocks and ETFs for just $4.95 per trade. Mutual funds are a bit of a problem, however. They do offer a handful of fee-free in-house mutual funds. But the commission on all others is a whopping $76 per trade.
They require a minimum $1,000 open an account, but they don’t require any annual fees. And if you don’t feel like managing your own account, Charles Schwab also has a robo-advisor service for you to take advantage of. Charles Schwab Intelligent Portfolios will provide you with professional investment management. It requires a minimum balance of $5,000, but there is no fee for the service.
One of the premier online discount brokers, Fidelity offers consumers an opportunity to open a traditional IRA, Roth IRA and 401(k) Rollover. They also offer a variety of small business retirement plans (like SEP IRA’s). There are no opening costs or annual fees for any of these IRA’s but if you decide to close them out for any reason, a $50 fee applies.
Here’s a short list of all the other investment accounts you can open up with Fidelity:
- Mutual Funds
- Options Trading
- Stock Trading
- Bonds and High Yield CD’s
- 529 College Savings Plan
Merrill Edge is currently offering up to $600 when you fund a new retirement account. The bonus is offered when you open a new retirement account; and the amount received is award in the following tier amounts:
- Less than $20,000 deposited – No bonus
- $20,000 – $49,999 – $100 bonus
- $50,000 – $99,999 – $150 bonus
- $100,000 – $199,999 – $250 bonus
- More than $200,000 – $600 bonus
To receive the bonus, you must make your deposit within 45 days, then keep the deposit in your account for 90 days. The bonus will post to your account within 2 weeks of the 90 day qualifying period. Use offer code 600ME when signing up.
Merrill Edge offers traditional IRA’s, Roth IRA’s and a 401(k) rollover.
Most of the investment brokerage firms on this list also offer a robo-advisor service. But Wealthfront is a robo-advisor, and one of the very best. If you’re looking for low-cost professional management of your IRA, Wealthfront is an excellent platform to investigate.
They offer a portfolio diversified between equities and fixed income investments, but also has alternative investments. Unlike most other robo-advisors, Wealthfront adds real estate and natural resources to the investment mix.
You can open an IRA account with as little as $500. The annual advisory fee for the account is 0.25%. But they’ll manage the first $10,000 for free. That means that you can have a $100,000 IRA account with Wealthfront fully managed for just $225 per year. They handle all the account management for you. All you have to do is fund your account.
Like Wealthfront, Betterment provides a fully managed investment portfolio. All you need to do is fund your account. They will allocate your portfolio between equities and fixed income investments. But they offer no alternative investments. However, unlike Wealthfront, Betterment has no minimum initial deposit requirement. You can sign up for the account and simply fund it with monthly contributions.
Betterment has two fee structures. The basic account has a 0.25% annual fee. The premium version, which requires a $100,000 account balance, has a 0.40% annual fee.
Which of these IRA providers should you choose? A bit of research will point you toward the one that will work best for you. But in truth, you can’t go wrong no matter which one you choose!
Updated March 14, 2018 and originally published January 16, 2018.