A traditional individual retirement account is a great asset to include in your retirement planning strategy. It is available to any investor, regardless of income level. Those under the age of 50 are limited to $6,000 in annual contributions. Those aged 50 and over are allowed $7,000. Contributions to an IRA account are made before taxes are deducted from your income. This lowers the tax amount you owe in each of the years you fund your IRA. You will pay taxes when you withdraw money from your account in retirement. Selecting the right account for you depends on what type of investor you are and how much you are willing to pay in fees. Here are the five best IRA accounts available today.
Table of contents
- 5 Best IRA Accounts
- Best IRA Accounts: Our Top Picks
- Best IRA Accounts – The Bottom Line
- Quick Questions
5 Best IRA Accounts
- Betterment IRA: Computer algorithm investments
- Firstrade: Fee-free investing
- TD Ameritrade IRA: Robust research library
- Fidelity IRA: Great for all investor types
- Charles Schwab IRA: Low fees
Best IRA Accounts: Our Top Picks
Betterment IRA — Automated Investing by Computer
Instead of using a personal portfolio advisor, the Betterment IRA uses computer algorithms to choose the fund to place your retirement money, keeping your annual fee to 0.25%. You provide the computer with the initial data by indicating your risk tolerance and retirement goals. However, investors have the option to upgrade to a human advisor by maintaining a $100,000 minimum account balance and paying a 0.40% annual fee. Betterment offers all customers automatic account rebalancing and assistance with creating effective tax strategies. Socially responsible investment portfolios are also available.
Firstrade — Commission-Free Investing
Firstrade is the best IRA account for anyone who wants no fees or minimum balance requirements. Their website isn’t as high tech as our other choices, but you save money with no account fees or commissions paid on any of your stock, mutual funds or ETF trades. Firstrade will also give you a $200 rebate if you transfer an existing IRA to their platform.
TD Ameritrade IRA — Free Research Tools
Another of the best IRA accounts for lower fees is the TD Ameritrade IRA, which offers no monthly or trading fees or a minimum required account balance. Their website is easy to use and is full of free professional research tools to help you make the right choices for your retirement needs. TD Ameritrade also offers a large selection of investment options, including cryptocurrencies and 4,200 mutual funds with no transaction fees.
Fidelity IRA — Great for all Types of Investors
The Fidelity IRA lands on every industry expert’s list of best IRA accounts, and for a good reason. It is a great account for beginners and active investors. This IRA requires no minimum balance and has no monthly fees. Fidelity also offers no transaction fees on 3,400 mutual funds and has four no expense ratio funds you can buy, hold or sell at no cost. Their retirement tools help all investors understand where they stand relative to their goals and offer suggestions for improving their return on investment. Fidelity also has the best mobile app of all our top picks.
Charles Schwab IRA — Several Advisor Options
The Charles Schwab IRA offers investors several advisor options. Do-it-yourself account holders trade stocks and ETFs with no commission fees and can choose from 4.200 no transaction fee mutual funds. For a $5,000 minimum investment, Schwab Intelligent Portfolios uses computer algorithms to automatically add low-fee ETFs to your portfolio based on your specified retirement goals and profile. Schwab is also recognized for offering all clients premium retirement research tools, including equity ratings, earnings reports and financial news in real-time.
Best IRA Accounts – The Bottom Line
Each of these IRA accounts will help you increase your retirement savings. Take a closer look at our top picks to decide which one is the best choice for your individual needs.
Yes, you can switch to another IRA provider. Be sure to contact your new account’s customer service for assistance in making the change as taxes or penalties could apply if the funds are not moved within a certain time frame.
Market fluctuations can cause you to lose money in your IRA, as with all investment options. To minimize the risk, invest in several companies of different sizes and industries so that if one company goes down in value, the others will balance out the loss.
It is always best to invest in a 401(k) if your company matches your contributions. IRA accounts give you more investment choices than a 401(k), so consider having both options in your retirement plan.
Interested in using a Robo advisor for your investing? Check out our guide to the best Robo advisors here.