Where to open an IRA can be an intimidating question. Options range from online discount brokers to robo advisors to mutual fund companies. With all of these choices, it can be difficult to know which is best. Whether you are looking to open a traditional IRA, Roth IRA, rollover or even a SEP IRA, in this article we’ll cover the best IRA accounts based on how you want to invest.
The key to choosing where to house your retirement account is your investing style. If you want to invest in a single family of mutual funds, an account at the mutual fund company is sensible. If you want somebody else to handle your investments, including rebalancing, a robo advisor is an ideal choice. And if you want to trade stocks and ETFs, an online discount broker is the way to go.
I’ve personally used all of the above options, which are covered below. We’ll first look at the top choices for IRA accounts, and then cover a longer list of options in more detail.
The Best Options by Investing Style
Best IRA Account Brokers in 2018
- Betterment: The best IRA option for first-time investors. Very easy to use and extremely low fees.
- M1 Finance: The best free IRA option. Choose between their pre-built portfolios or custom build your own.
- Ally Invest: Best hybrid approach. You get access to Ally Invest Managed Portfolios, an automated investment service, as well as its award-winning, low-cost brokerage services.
Betterment
Betterment is the easiest way to get started with an IRA and an excellent choice for first-time investors. Simply select how much you want to invest in stocks and bonds, and Betterment does the rest. It re-balances your investments and reinvests your dividends automatically.
- IRA’s available: Traditional / Roth / Rollover / SEP
- Fees associated with the account: None (No opening, maintenance, custodial or closeout fees of any kind). Betterment does charge a fee based on account balance that ranges from 0.25% to 0.40%.
- Account minimums: None (No initial minimums and/or account requirements)
- Takeaway: Betterment is ideal for those who want low cost passively managed investments, but don’t want the hassle of picking mutual funds and rebalancing. For more information check out our Betterment review or visit Betterment.
M1 Finance
M1 Finance is a fantastic all-round investment platform. Get the simplicity of a roboadvisor with added customization options. Opt into one of their expert portfolios or customize your portfolio by adding individual ETFs or stocks. They charge no commission or management fees, so you can keep more of your money. Easily roll over your old 401(K) or transfer another IRA with the rollover concierge.
- IRA’s available: Traditional / Roth / SEP
- Fees associated with the account: None
- Account minimums: $100 for a standard account; $500 for a retirement account
- Takeaway: M1 Finance is a great option for those who want a simple, hassle-free investment experience, which some customization options. For more information check out our M1 Finance review or visit M1 Finance.
Vanguard
Vanguard is the king among low cost index mutual funds. Because the firm is not seeking to make a profit, it passes the savings on to investors. I’ve had multiple accounts at Vanguard for years, including Individual Retirement Arrangements and other retirement accounts. In addition to mutual funds, Vanguard offers ETFs and brokerage services.
- IRA’s available: Traditional / Roth / Rollover / SEP
- Fees associated with account: None (No opening, maintenance, custodial or closeout fees of any kind)
- Account minimums: $1,000
- Takeaway: An excellent choice for those who want to invest in Vanguard funds and have a minimum of $1,000 to invest.
WealthSimple
WealthSimple is a sophisticated robo advisor that is very easy to use, low cost, and with excellent features. Much like Betterment, all you need do is select the allocation you want between stocks and bonds. From there, Wealthfront invests your IRA in several low cost well diversified ETFs. It rebalances your investments and reinvests your dividends automatically.
- IRA’s available: Traditional / Roth / Rollover / SEP
- Fees associated with account: None (No opening, maintenance, custodial or closeout fees of any kind). WealthSimple does charge a 0.50% fee based on account balance and a 0.4% fee for balances over $100,000. The first $5,000 is managed for free.
- Account minimums: None
- Takeaway: WealthSimple is ideal for those who want sophisticated asset allocation at a low cost and with minimal effort. For more information visit WealthSimple.
Wealthsimple Disclaimer:
DoughRoller has entered into a referral and advertising arrangement with Wealthsimple US, LTD and receives compensation when you open an account or for certain qualifying activity which may include clicking links. You will not be charged a fee for this referral and Wealthsimple and DoughRoller are not related entities. It is a requirement to disclose that we earn these fees and also provide you with the latest Wealthsimple ADV brochure so you can learn more about them before opening an account.
Ally Invest
Ally Invest is unique among IRA accounts. It offers both traditional online brokerage services with trades as low as $4.95. It also offers what it calls Ally Invest Managed Portfolios, an automated investment service. It’s like getting Betterment and E*Trade in one.
- IRA’s available: Traditional / Roth / Rollover / SEP / SIMPLE
- Fees associated with account: None (No opening, maintenance, custodial or closeout fees of any kind). Ally Invest Managed Portfolios, like all robo advisors, charges a small fee. This fee is 0.30% annually.
- Account minimums: None for brokerage services. $2,500 for Ally Invest Managed Portfolios
- Takeaway: Ally Invest offers both brokerage and automated investment services. Ideal for those wanted a wide range of IRA account types and investment options. For more information check out our Ally Invest review or visit Ally Invest to open an IRA.
E*Trade
E*Trade was the very first online broker I signed up with after graduating college. With their recent purchase of OptionsHouse, their trading platform is my personal favorite. E*Trade offers a wide variety of account opens and IRA’s, and also offers small bonuses for moving over an IRA to E*Trade.
- IRA’s available: Traditional / Roth / Rollover / SEP / SIMPLE / IRA for Minors /Beneficiary / Roth IRA CD / Traditional IRA CD
- Fees associated with account: No annual fees
- Account minimums: None
- Takeaway: If you can avoid some of the fees with high balances, E*Trade is a full-service brokerage option. For more information check out our E*Trade review or visit E*Trade.
TD Ameritrade
TD Ameritrade is a trusted brokerage house with excellent IRA options. Its research tools are unparalleled, and it even offers up to $600 when you rollover a 401k to an IRA. You can open an account online in just minutes.
- IRA’s available – Traditional / Roth / Rollover / SEP
- Fees associated with account – No set-up, maintenance or annual fees.
- Account minimums – None (No initial minimums and/or account requirements)
- Takeway: Well known for its trading tools and research, TD Ameritrade was ranked #1 for IRA accounts by Kiplinger. For more information check out our TD Ameritrade review or visit TD Ameritrade.
Final Thoughts
When deciding which online discount broker is the best place to transfer an existing IRA, or start investing in a new one, there are a few important factors to consider. First, you should make sure that the broker offers the specific type of IRA you are interested in. While most online discount brokers carry the same IRA accounts, there are a few unique options available.
The next and most important question you need to ask is “What are the fees associated with opening, maintaining and closing my IRA?” If you are paying a high premium, then the tax benefits may not be worth it in the long-run. Finally, when you factor in account minimums and customer service, you should find the online discount broker that’s right for you.
Topics: Investing
Hello Rob
A question on IRA’s.
I am looking to open a traditional IRA to off set taxes for 2017. I currently have one through Vanguard but thought about an IRA CD through my credit union.
Thoughts?
So I’m basically going to be receiving money due to the selling of my home,
I’m now 47 but with knowing any financial knowledge prior
I was very niece and lost a large investment in this home . I know have learned a valuable lesson and I will be actually receiving equity because I stayed and fought many years through the pain and even through having to be in chapter 13 twice four years apart. Do that my mortgage company couldn’t take my home.
I have been lied to and my papers were forged through signatures that were signed from employees who were involved in a a mortgage scandal and it was even shown on television on the new report 60 minutes. Now I finally am coming out of this horrible nightmare, after my years of traumatic stress from them all .
And I need assistance yo use the money to make the right decisions now.
I was used and the mortgage company charged me so much more then they were allowed too , but without legal representation and help I had no chance so I finished and one day away from this .
Ready to move forward with my life
If you have any advice for me.
I want to invest in cds and a retirement fund. And I have a book I’m publishing
I’ve been on a fixed income and I am Nevada but ready to stand up and take control over my new life.
I hear all these opinions, I just don’t know what to believe and what to do,
If you have hard and sound advice , I’d be so thankful to hear you
Thank you , and many blessings
Hard times makes us strong which we never thought of.
Good that all your stress is finally over.
Based on the money , you are going to get, please divide it into 3 portions.
1, Liquid cash – Good enough to handle 3-4 months of your basic expenses . There are high yield online savings account which almost provides same as CDs (1.2 – 1.3 %) from Discover, Ally etc.
2. Roth IRA – Invest the max you can in Roth IRA (5.5k/year – so you can invest 11k max now for 2017 and 2018). TD, Vanguard etc.
3. IRA – Use the remaining balance to fund an IRA account.- TD , Vanguard etc.
Trust yourself that you will be successful and you will. Good luck for your new life!!
With Hearty Wishes!!
Beside commission fees, what is the problem of investing in Vanguard products using a different broker?
TD Ameritrade is removing Vanguard index funds from their commission free investing fund list next month. FYI when making a decision for those looking through the list.
Hi Rob,
I quit my job and went back to school. I left my 401K with the company. They merged and are shutting down the plan. I need to roll over it over. I have a Roth with a different company but I should roll it over to a traditional IRA. I would like a company that would do the investing work for me and I’d like to put in monthly. There are so many choices and I’m not sure who to open an account with? Please advise.
HI ROB
I’m leaving my job due the fact the company’s moving.I have a 401k would like to due a rollover Ira.Looking for the right place to go. Thank you
Hi Rob,
My employer is a non-profit that runs an SEP plan which I have just now become eligible for. In order to receive my employer’s contributions, I need to open my own SEP IRA, but I have no idea who I should open it with. I’ve only ever had a 401k previously, through a former employer (it was emptied long ago during a bout of unemployment, so no rollover issues to deal with), and know very little about investing. Just looking for some advice on who to set this up with. Based on some of the limited research I’ve done it looks like maybe Scottrade or TD Ameritrade might be good options, given no account fees/minimums. Given my lack of investing knowledge, I don’t really want to get involved in any buying/selling/trading; I’m more interested in a set-it-and-forget-it type of situation. Any advice?
Betterment or Wealthfront company.
hello Rob,
I just turned 41 and I would like to invest in a ROTH IRA for the first time. What would be the best profitable option for me?
Hi Rob, I am 60 years old and have a traditional IRA with Fidelity. A previous employer has recently sent me a packet offering a lump sum pension payout, which I’m considering taking.
If I do, I plan to rollover into an IRA. To be honest, I do not know the fees associated with Fidelity. Trying to decide whether to stay with them or go with someone else. I’ve been reading about Betterment. Fidelity has something about a 3 yr match right now.
Your thoughts. Thank you
I have had Fidelity since 2009 and have not seen my account improve since then, keeps going up and down. Ive finally given up on them and looking elsewhere.
Hello I wish to open a Roth Acct for 4 grandkids We will not be able to start with more than perhaps 100.00 in each acct and add perhaps 50.00 per month any ideas thanks
Interesting analysis ! I learned a lot from the points – Does someone know where my company might be able to get access to a fillable Canada T2125 document to complete ?
Hi Florida, my partner pulled a sample Canada T2125 form using this
https://goo.gl/BQpCTi.Hi Rob, i’m looking on investing my money with high yielding interest for retirement purposes. I just had an IRA with vanguard but would like to check other companies with excellent teack record and low fees. any investment companies you recommend for bonds, stocks, etc.?
Mike, Vanguard is my personal favorite. But there are plenty of other options for low-fee index funds, such as Fidelity.
Hi, I want to open a SEP IRA. I have a traditional trading account with tdameritrade but I’m not an active trader. Do you think it’s better to open the SEP with them or with a mutual fund company like Fidelity? If with a mutual fund company, which one would you recommend?
I’m 39 years old.
Thank you.
Bob, it really depends on what you want to invest in. If you like a specific mutual fund company, opening the SEP with them is generally a smart move. I use Vanguard because I prefer its index funds.
Hello Rob,
I am 27 years old, the company I work for does not provide 401k so I am looking into a Roth IRA for when it comes time to retire.. I basically want to set it and let grow on it’s own with minimal intervention. Entry with no minimum account or maintenance fees. What would you suggest.
If you must have no minimum, it’s going to be tough to find an option with no fees. Vanguard has a $1,000 minimum. You won’t pay maintenance fees, just the expense ratios of the funds. Betterment has no minimum, but they do add an extra charge on top of the ETF fees.
Rob, I’m looking for an app that will compare mutual fund performance (return minus fees(mgmt, mkt, etc) minus sales charge) to other funds in the same class AND to all relevant industry benchmarks.
Do you have an opinion/review on GardVest?
Will Personal Capital provide this info?
Thanks!
Chip, I’d suggest using Morningstar. I’ve not used GardVest, but will check it out. I don’t think Personal Capital provides this type of information.
Thanks for the reviews Rob, very helpful. I am 31 years old and am wanting to start investing and opening up a ROTH IRA…. would it be advisable to open it up with my credit union? Otherwise I was thinking about TDAmeritrade as I have read mostly good things about them, including your article.
…P.S….. I have some money in mutual funds and already a ROTH IRA with Edward Jones(I just opened it)….. What are your thoughts about Edward Jones? —– Thanks.
Jas, I’ve never used Edward Jones. My concern, however, would be with fees. If you can find low cost index funds to invest without paying an advisor, they may be fine. But I’ve heard Edward Jones can charge really high fees.
A lot depends on how you want to invest the money you contribute to the Roth IRA. If you plan to buy stocks and ETFs, I think TDAmeritrade is a fine choice. If you want to invest primarily in mutual funds, I’d open the IRA at the mutual fund company whose funds you plan to buy (e.g., Vanguard or Fidelity).
Hello Rob,
I need some advise. I went from using a financial advisor at Well’s Fargo to a financial advisor with wealth financial services, transferred my IRA account to TD ameritrade. I was told there was a charge of 1.75% annual. It’s more like 1.75% per qt. With the market being what it is and the fees my advisor is charging I am out $14,000 to date.
Can I stay with TD ameritrade and do away with this advisor? I have to do something fast/please advise.
Ed, you can use TD Ameritrade without a financial advisor. Absolutely.
I’m trying to open a Roth IRA but looking for low cost brokerage firms.
Can anybody recommend a good brokerage firm?
How about opening up a ROTH with a bank or credit union, would that be a better option?
Advice on this answer would be much appreciated.
hec, I think one of the best brokerages for an IRA is Scottrade. That’s where I opened my first SEP IRA. They have offices throughout the country, excellent customer service, and low cost trades.
I am trying to locate a broker that will allow me to write credit spreads in my roth ira account. Can anyone tell me who allows this?
Hi,
You can also use other traders like Interactive Brokers who charge very less trading costs and they also support DRIP. I have personally used TradeKing and Interactive Brokers which are both good.
I use Scottrade for my Roth IRA, but they do not offer automatic reinvestment of dividends. Is there a company with similar fees to Scottrade that offers automatic dividend reinvestment?
Ryan, that’s a great question. There are several brokers on the list above that offer automatic dividend reinvestment: E*Trade and OptionsXpress. I have an account at OptionsXpress. All you need to do is an online chat with them and they can set you up with the DRIP. It took all of 60 seconds.
Also, Betterment reinvests dividends automatically, but as you may know, it’s not a traditional broker.
@ Cynthia, consider seeking out a financial planner, they will be able to guide you into what product suit your individual goals, but will only charge a fee for their knowledge. At least to get you started, this is pretty important stuff to go alone
After years and years investing with fidelity, i am leaving because of rudness, hostility, reps who dont care, high fees, they cost me a lot of money, be careful dealin with the devil
I just lost my job and I have to rollover my 401k to a IRA. I’m considering TradeKing but I would like some advice on what to do once I have rolled over my funds. I have only bought drips using the dollar cost average method of accumulating stocks. I just need to know once I rollover my funds can they sit there until I get educationed on making eft and/or stock trades.
Cynthia
Cynthia – Call them and ask about their fees – maintenance, minimuns- I have heard nothing but good about TradeKing. You might also want to call TD Ameritrade, they have good charts.
For Canadian investors they can look at Questrade.