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Best IRA Accounts of April 2019

April 1, 2019
Brokers, Investing, IRA
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An individual retirement account, or IRA, is one of the best places to save for retirement — the tax benefits can give your savings a nice lift. And, spoiler alert: It typically takes just 15 minutes to open an account. We’re here to help you find the best provider for your situation.

Every year, we evaluate a broad swath of major U.S. online brokers and robo-advisors to select the best IRA providers. Our favorites are below. (Note: The star ratings on this page are for the provider as a broker overall. Some brokers with a lower overall rating are included here because IRAs are where they excel.)

How (and why) to open an IRA

Opening an IRA is a simple process. You’ll need to provide some personal information, including your birthdate and Social Security number, but that’s about it.

Even if you have a 401(k) or other workplace plan, it can make sense to save in an IRA — as long as you also make sure to get any company 401(k) match you may be offered — because IRAs often offer more investment choices. This is important, because your investment returns will have a big impact on your savings over time.

Say you put $500 every month into an IRA (that adds up to the annual maximum of $6,000). The stock market’s annual average return of 8% would get you more than $475,000 after 25 years. Even if you earned a more conservative 6%, you’d end up with more than $345,000 after 25 years.

Choose your investment style

Pick the investor type that describes you so we can point you toward the best provider for your situation:

  • I’m a “do-it-yourself” investor. You can open an IRA at an online broker and then choose your own investments (this may be simpler than you think — you can build a diversified portfolio with just three or four mutual funds). With the providers detailed below, you generally won’t pay an account fee (though that may require your agreeing to electronic document delivery or maintaining a minimum account balance), so the primary costs you need to watch for are trading commissions and investment fees (which are also called expense ratios).
  • I’m a “manage it for me” investor. If you’d rather have someone pick an investment portfolio for you, you can open your IRA at a robo-advisor. Robo-advisors are online investment services that build and maintain a diversified portfolio for you. You pay a small fee for the service, but their fees tend to be substantially lower than for a human financial advisor — typically 0.25% to 0.50% of the assets under management annually. These services are growing rapidly today: One of our top robo-advisor picks, Wealthfront, has over $11 billion in assets under management.

Best IRA brokers for “do-it-yourself” investors

For people who want to pick their own investments, opening an IRA at an online broker makes a lot of sense. At the best brokers, you’ll find a large list of low-cost investments to choose from, including index mutual funds and exchange-traded funds. The top brokers also offer extensive retirement planning tools, robust customer service and reasonable account minimums and fees. And you maintain complete control over how your retirement funds are invested. Here are three of the favorites from this year's analysis:
cheatgame.info rating

Fees

$4.95

per trade

Account minimum

$0

Promotion

Up to $3,500

in cash bonus with a qualifying deposit

The bottom line

Ally Invest’s low commissions, no annual fee and no account minimum make it a good choice for IRA investors. For investors who want to be more active, the broker also offers a solid suite of research and tools, but IRA customers may be put off by closure and transfer-out fees.

Show pros & cons

Pros

  • Low commissions.

  • No account minimum.

  • No IRA annual fee.

  • Strong web-based platform.

  • Robust research and tools.

Reader favorite

Cons

  • IRA closure fee of $50.

  • IRA transfer out fee of $50.

Read full review
cheatgame.info rating

Fees

$6.95

per trade

Account minimum

$0

Promotion

$100-$600

in cash bonus with a qualifying deposit

The bottom line

Merrill Edge offers high-quality customer service, robust research, low commissions and fees — all with no account minimum for IRA investors. Customers of parent company Bank of America will love the seamless, thoughtful integration, with a single login to access both accounts.

Show pros & cons

Pros

  • Robust third-party research.

  • Ongoing promotions for opening and funding a qualified IRA account.

Reader favorite

Cons

  • No commission-free ETFs for IRA investors.

  • Minimum balance requirement for high-end platform.

Read full review
cheatgame.info rating

Fees

$6.95

per trade

Account minimum

$0

Promotion

Up to $600

in cash bonus with a qualifying deposit

The bottom line

Retirement investors will find a lot to love with E-Trade’s IRA offering, including a large line-up of no-trading-fee mutual funds and an extensive library of retirement advice and tools. Plus, there’s no minimum account balance.

Show pros & cons

Pros

  • No minimum balance for IRAs

  • Extensive research and tools

  • 156 commission-free ETFs

  • 4,400+ no-transaction-fee (NTF) mutual funds

Reader favorite

Cons

  • $19.99 cost for trading non-NTF mutual funds

  • Higher trading fees for low-volume ETF and stock traders

Read full review

Want more options? Here are the rest of our category winners for do-it-yourself investors:

Best IRA robo-advisors for “manage it for me” investors

For people who want to invest for retirement but don’t want to worry about managing their portfolio over time, a robo-advisor is an easy choice. Generally, robo-advisors hire investment pros to develop a handful of portfolios aimed at different types of investors. Some robos offer portfolios that vary based on amount of risk, with “aggressive” ones for people who want a high percentage of their portfolio in stocks and “conservative” for people who seek a less volatile investment account. As an investor, all you have to do is open your IRA, link your bank account and follow the steps the provider uses to build your portfolio. The robo-advisor then purchases the investments for you and manages the account over time. Many robos also offer services that can help maximize your savings, such as goal-setting tools to get your finances on track, and strategies to reduce your tax bill. (Robo-advisors generally are registered investment advisors, operating under a similar structure to human investment advisors.) Here are our top three picks for investors who prefer help with management:
cheatgame.info rating

Fees

0.25%

management fee

Account minimum

$500

Promotion

$5,000

amount of assets managed for free

The bottom line

Wealthfront takes the hassle out of IRA investing. The robo-advisor manages accounts by constructing portfolios out of low-cost ETFs, with a flat and low-cost fee structure that appeals to investors seeking a hands-off approach. What’s more, the company has built client trust by offering free management on the first $5,000 invested (for cheatgame.info readers).

Show pros & cons

Pros

  • Low-cost, hassle-free approach to IRA investing.

  • First $5,000 managed free (for cheatgame.info readers).

  • Automatic rebalancing.

  • Free automated tax-loss harvesting.

Reader favorite

Cons

  • No large-balance discounts.

  • No access to human advisors.

Read full review
cheatgame.info rating

Fees

0.25%

management fee

Account minimum

$0

Promotion

Up to 1 year

of free management with a qualifying deposit

The bottom line

With its low-cost ETFs, automatic rebalancing, extensive tax strategies and retirement advice, Betterment is a strong bet for retirement investors. Betterment’s planning tools include advice on “asset location” — which types of investments are best for different types of accounts — and investors can sync outside accounts, as well.

Show pros & cons

Pros

  • No account minimum.

  • Extensive tax strategies.

  • Robust goal-based tools.

  • Free automated tax-loss harvesting.

Reader favorite

Cons

  • Limited investment options.

Read full review
cheatgame.info rating

Fees

0%

management fee

Account minimum

$100

Promotion

Free

career counseling loan discounts with qualifying deposit

The bottom line

SoFi Automated Investing is great for beginning, cost-conscious investors who favor a hand-off approach. Plus, as a customer you could be eligible for bonuses on other SoFi products.

Show pros & cons

Pros

  • Broad range of low-cost investments.

  • Very low management fees.

  • Automatic rebalancing.

  • Customer support.

  • Access to certified financial planners.

Reader favorite

Cons

  • No tax-loss harvesting.

  • Limited account types.

  • Short track record.

Read full review

Summary: Best IRA account providers

Broker
Best
for
Highlights
Commissions
Promotion
Account minimum
Start investing

Ally Invest

Ally
Active traders
Competitive commissions, no account minimum
$4.95
per trade
Up to $3,500 cash bonus and commission-free trades with a qualifying deposit
$0

Merrill Edge

Merrill Edge
Retirement tools
Robust, easy-to-use research tools
$6.95
per trade
Up to $600 cash bonus with a qualifying deposit
$0

Wealthfront

Wealthfront
Hands-off investors
Link outside accounts to free personal-finance tool Path
0.25% of account balance
per year
$5,000 managed free for cheatgame.info readers
$500

E*Trade

E*Trade
No account minimum
Waives $500 account minimum for IRAs
$6.95
per trade
Up to $600 cash bonus and 500 free trades with a qualifying deposit
$0 for IRAs

So-Fi Wealth

sofi-logo
Hands-off investors
Unlimited access to financial advisors for free
Investment management is free
No management fee in 2019
$100

Betterment

Betterment
Hands-off investors
Offers phone access to human advisors for a fee
0.25%-0.40% of account balance
per year
Up to one year of free management with qualifying deposit
$0

TD Ameritrade

Overall and no account minimum
Commission-free:
310+ ETFs and 4,130+ funds
$6.95
per trade
Trade commission-free for 60 days and up to $600 cash bonus with qualifying deposit
$0

Interactive Brokers

Active traders
Discounts for frequent traders; among the best platforms
$0.005
per share;
min. $1, max. 1% of trade value
None
$0

Vanguard

Vanguard
Low cost
Commission-free: 1,800+ ETFs and 3,080+ mutual funds
$2 to $20 per trade depending on account balance
None
$0

Charles Schwab

Charles Schwab
Overall and low cost
Commission-free:
260+ ETFs and 4,350+ mutual funds
$4.95
per trade
$100 referral award for first-time clients
$0

Fidelity

Overall
Strong trading platform, low commissions
$4.95 per trade
300-500 free trades with qualifying deposit
$0

T. Rowe Price

T. Rowe Price
Retirement tools
Commission-free:
170+ ETFs and 2,800 mutual funds
$19.95
per trade
None
$1,000 for IRAs

Note: Some of these promotions won’t apply for first-time depositors, due to IRA contribution limits of $6,000 per year in 2019. We’ve included promotions with low deposit requirements where available.

Our rating methodology

cheatgame.info’s ratings for brokers and robo-advisors are weighted averages of several categories, including investment selection, customer support, account fees, account minimum, trading costs and more. Our survey of brokers and robo-advisors includes the largest U.S. providers by assets under management, notable and/or emerging players in the industry. Factors we consider, depending on the category, include advisory fees, branch access, user-facing technology, customer service and mobile features. The stars represent ratings from poor (one star) to excellent (five stars). Ratings are rounded to the nearest half-star.

IRA FAQs

Anyone can open a traditional IRA — there are no income limits — but if you’re also covered by a workplace retirement plan like a 401(k), the amount of your contribution that you can deduct on your tax return may be phased down or eliminated based on your income.

If you exceed the income limits, you can still make the maximum annual contribution, but a portion or all of it will be considered a nondeductible contribution. There’s no immediate tax benefit on nondeductible contributions, but you’re still able to defer taxes on investment income until retirement. Read more about the traditional IRA deduction limits.

Roth IRAs have income limits for eligibility; if you earn too much, your contribution limit is phased down or eliminated completely. To see if you’re affected, use our Roth IRA calculator.

IRA accounts offer significant tax benefits over traditional savings and brokerage accounts. As long as your money stays in an IRA, you’ll owe no tax on your investment earnings — that means you have a bigger nest egg to compound and grow each year. In contrast, with a traditional brokerage account, taxes may eat into your savings every year, depending on how you invest.

And if you qualify for a deductible IRA, the benefits are even greater, because you’ll reduce your taxable income for the year you contribute. For example, if your marginal tax rate is 25%, a $6,000 IRA contribution can reduce your tax bill by $1,500. See if you’re eligible for a deductible IRA here.


There are a few differences between these accounts, but the main way they differ has to do with taxes:

  • A traditional IRA earns you a tax deduction on contributions for the year they are made. You’ll then pay income taxes on the distributions you take in retirement. Because you’re delaying taxes until retirement, the investment growth in a traditional IRA is tax-deferred.
  • A Roth IRA offers no tax deduction when you make contributions, but qualified distributions in retirement are not taxed. That makes the investment income in a Roth IRA tax-free — you won’t pay taxes on it at all, so long as you wait until retirement to access it.

Generally, a traditional IRA is best if you expect your tax rate to be lower in retirement than it is now — by putting off taxes until retirement, you’ll pay that lower rate. If you expect the opposite to be true — your taxes are lower now and will be higher in retirement — you may want to choose a Roth IRA.

For more on this decision, dig into our comprehensive comparison of Roth and traditional IRAs.

You can contribute up to $6,000 to an IRA each year, or $7,000 if you’re 50 or older. (Those are the contribution limits in 2019.) That’s a combined limit shared by the two types of IRA — you can have both a Roth and a traditional IRA, but that maximum limit applies to all of your IRA contributions combined. But the contribution limit doesn’t include amounts rolled over, such as from a 401(k).

This is a retirement account, so the money is intended to stay put until age 59 ½ or later.

That said, traditional IRA withdrawal rules are stricter than Roth IRA withdrawal rules: With a traditional IRA, you may be taxed and hit with a 10% early withdrawal penalty if you pull money out before age 59 ½. There are a few exceptions.

With a Roth IRA, you can pull your contributions out at any time — remember, you’ve already paid taxes on them. You may be taxed or penalized on early distributions of investment earnings, however.

It’s a simple process: You can open an IRA online, at any broker or robo-advisor (though we’re partial to the ones above, for the reasons we outlined). It takes about 15 minutes and you’ll need to provide some personal information, including your name, birthdate, mailing address and Social Security number. Here’s our guide to opening an IRA, which also includes information about how to fund and invest the account.

Unlike savings accounts, IRAs don’t pay a set interest rate or return. Once you’ve put money into the account, you need to select investments; otherwise, your money will sit in cash, which isn’t ideal for a long-term goal like retirement. Most IRA providers offer a wide range of investment options, including individual stocks, bonds and mutual funds.

If that sounds out of your league, you can open your IRA at a robo-advisor — like the two mentioned above — which will manage your investments for you for a small fee.

 

To recap our picks by category:

cheatgame.info’s best IRA providers for April 2019