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Best IRA Accounts

For beginning investors, it’s easy to get hung up on investing when you’re not sure where to put your money or how to begin.

An individual retirement account (IRA) is a retirement account that allows you to save for the future on either a tax-deferred or tax-free plan.

Open an IRA and it’s a great way to help build wealth and watch your money grow, especially if your employer does not offer a 401(k) program, you are self-employed or you’re a younger investor. Read on for a crash-course in IRAs and saving for retirement.

Recommended IRA - Ally Invest

Ally Invest has a No-Fee IRA that includes 90 days of free trades with a $5,000 deposit. However, there is no minimum to open an account with Ally, and they will even pay transfer fees from another IRA provider should you chose to grow your retirement account with Ally.

Quick look – our favorite IRA providers:

First, you need to choose if you need a Traditional IRA, Roth IRA, or 401(k)

Before you decide on an IRA provider, you’ll need to choose whether a traditional or Roth IRA is right for you.

1. Consider how you’ll want to be taxed

In short, a traditional IRA allows you to deduct contributions on your annual federal tax filing, essentially allowing you to defer your tax payments until you withdraw your money in retirement.

A Roth IRA forces you to pay taxes on your contributions, but you don’t have to pay taxes when you withdraw the money. This means you can pretty much watch your investment grow tax-free. If you believe that taxes will be higher when you retire, you should choose a Roth IRA. If you feel that the reverse is true, a traditional IRA is probably right for you.

A 401(k) is an employer-sponsored plan, often coming with a match from your employer, where you can save and invest your pre-tax earnings. If this is available to you, use it! But if you go over your annual contribution limits, another investment vehicle, like a traditional IRA, work great for you.

2. Consider contribution limits

The IRS has placed some pretty strict limits on how much money you can contribute to your IRA every year. Regardless of whether you have chosen a traditional or a Roth IRA, you can only contribute a maximum of $5,500 to your account per year.

As you age, the government allows you to contribute a bit more. Investors over the age of 50 can contribute up to $6,500 annually.

3. Consider income restrictions

There are also some restrictions on IRA contributions if you make over a certain amount of money. If you earn over $133,000 annually and you’re filing your taxes as a single individual, you’re not eligible for an IRA. Couples who file a joint income of over $196,000 are also ineligible for both the traditional and Roth IRA.

Features Roth IRA Traditional IRA 401(k)
Tax benefits Tax-free growth and qualifying withdrawals Tax-deferred growth and tax-deductible deposits Employer-sponsored savings, save & invest pre-tax earnings
Age requirements No requirement Must be under 70.5 years old to contribute 21 years old
Contribution limits $5,500 for those under 50 years old, $6,500 for those 50+ $5,500 for those under 50 years old, $6,500 for those 50+ Employees can contribute up to $18,500 (not including employer match)
Income limits Depends on marital status and adjusted gross income No No
Taxes on withdrawal No Yes Yes
Taxes on deposits Yes No No
Early withdrawal penalty Yes, pay taxes on amount plus 10% penalty Yes, in some cases a 10% penalty Yes, pay a penalty
Required withdrawals No Yes, by age 70.5 Yes, by age 70.5

How we chose the best IRA accounts

Put simply, these three companies are at the top of the list because they go above and beyond industry standards.

  • They are trusted household names, an obvious necessity when your nest egg is on the line.
  • They offer a depth and breadth of products, pack a punch with their customer service options, and don’t miss the mark in providing a boatload of educational opportunities through their websites and platforms.  
  • They have reasonable (or free!) commissions and fees so you can maximize your long-term investing power.

Best overall

Best For
  • Beginner investors
  • Advanced traders
  • Investors who want portfolio-building advice.

TD Ameritrade

TD Ameritrade is perfect for every sill level, as there’s a $0 required minimum balance. TD Ameritrade offers in-depth, yet easy-to-understand research and investment advice.

The company also offers a number of customer service options, including 24/7 phone support, email, text, Facebook messenger support, and local branch advising options.

The investing giant also offers a massive range of investment options, with 300 commission-free ETFs and over 4,000 no-fee mutual funds.

One of TD Ameritrade’s most unique functions is its brokerage boot camp—you can choose a trading level (rookie, intermediate, or expert) and TD Ameritrade’s platform will redirect you to investing research, articles, quizzes, and videos on better retirement planning tactics. 

Read Benzinga’s full TD Ameritrade Review

Best for beginners

Best For
  • Active traders
  • Beginners looking to start trading
  • Low fees
  • Penny stocks

Ally Invest

Ally Invest’s comprehensive suite of investment planning tools now rivals most major online brokers.

Like TD Ameritrade, Ally Invest comes with $0 account minimums, which can make it an appealing option for newer investors.

However, the IRA provider falls short when it comes to investing in mutual funds. Ally Invest offers no commission-free mutual fund investments, and you’ll need to pay a $9.95 commission on each mutual fund investment, meaning that Ally Invest is a good choice for the active trader. But Ally does offer a plethora of commission-free ETFs to make up for it. 

If you’re looking to stick your money into a mutual fund, you’re better off choosing another IRA provider.

Read Benzinga’s full Ally Invest Review

Best for commission-free trading

Best For
  • Mobile traders
  • Traders looking for research and data
  • Investors looking for retirement planning guidance

E-Trade

You probably already know about E-Trade for its intuitive stock buying program, but the company also offers an impressive range of mutual funds (over 150) and a massive range of NTFs (over 4,000).

E-Trade’s most unique option is its library of retirement planning advice, news stories, and how-to articles that can be useful to novice investors and seasoned traders alike.

If you’re looking to place your retirement funds into commission-free ETFs, E-Trade is a great option that offers mobile compatible support, plenty of data and research options and a $0 account minimum for IRAs.

Read Benzinga’s full E-Trade Review

Best robo advisor

Best For
  • Intermediate investors
  • Retired investors
  • College students

Betterment

Centered around goal-based saving, Betterment is a great choice for hands-off investors who want to learn more about how to save for retirement. Betterment supports traditional, Roth, and rollover IRAs, which are IRAs originating from your old employer-sponsored 401(k) and offers automatic tax-loss harvesting on all accounts.

When you create an account with Betterment, you’ll be guided through goal-setting exercises to help you analyze your finances and lifestyle to create a reliable and sustainable plan to grow your money for retirement. You can even set up auto-deposits to keep you on track to meet your short- and long-term goals.

Betterment’s RetireGuide offers IRA holders a personal picture of all of your savings, including on non-Betterment accounts, and offers tips and advice on saving and estimated retirement dates. Betterment is best if you’re a hands-off investor who prefers to have automation help you build your IRA.

Read Benzinga’s full Betterment Review

Best For
  • Passive investors
  • Lower fees
  • Beginning investors
  • Investors who don't want to manage money on their own

Wealthfront

Wealthfront is another great robo-advisor investment platform. Instead of an expensive personal financial advisor, Wealthfront’s team of algorithms analyze the market and make recommendations on where to invest based upon your capital, age and risk tolerance.

After you open an account with Wealthfront (there is a small $500 minimum account balance), the system’s robo-advisors will allot your money into a diversified range of ETFs.

Traditional, Roth, and rollover IRAs included, Wealthfront is best used by investors who aren’t interested in managing their own retirement account but who don’t want to deal with the high fees and minimums that come along with hiring a financial advisor.

Read Benzinga’s full Wealthfront Review

Best for buy-and-hold investors

Best For
  • Set-it-and-forget it investors
  • Saving on taxes
  • Complex financial planning for retirement

Vanguard

With over $3 trillion in managed assets, Vanguard is one of the largest IRA providers in the world. Vanguard’s standout features are its low-cost mutual funds and high-performing ETFs.

Investors can open an account with as little as $1,000, but many of the most popular funds (including the cornerstone Vanguard S&P 500) require an initial investment of $3,000. Though Vanguard may forgo the $0 minimum account balance offered by competitors, the company more than makes up for it with attentive customer service (with extended phone and chat hours) and a massive range of index funds.

Vanguard’s traditional and Roth IRA plans are best utilized if you’re a buy-and-hold investor who has a bit of cash saved up to open an account.

Read Benzinga’s full Vanguard Review

Now, follow through!

If you made it through all that technical jargon, good job. It’s even more essential that you read, digest this information, and actually do it.

Maybe this will motivate you (nothing motivates some people more than a compound interest table).

Check out what $100 per month can do for you at a rate of 12 percent (now, I know that 12 percent is quite high, but the concept is still the same, whether your rate is eight percent or ten.)

Time Value Time Value
5 years $8,167 30 years $349,496
10 years $23,004 35 years $643,096
15 years $49,958 40 years $1,176,477
20 years $98,926 45 years $2,145,469
25 years $187,885 50 years $3,905,864

If your employer doesn’t offer you a retirement plan, it takes even that much more initiative to open up your own IRA. If you can’t decide, it’s better to just choose a fund, already!

One last tidbit: Don’t sign up for a particular retirement plan just because your next-door cubicle neighbor Joe signed up for the same one. Your situation may be completely different from Joe’s (not to mention, if you’re 20 years younger than Joe, your portfolio should look much different).

That’s why assistance is available and you should take advantage of it, and with those three brokerages at your disposal, you won’t miss a beat.

Broker Best For Commissions Account Minimum Choose your platform
TD Ameritrade
  • Beginner investors
  • Advanced traders
  • Investors who want portfolio-building advice.
$6.95 $0
Get started securely through TD Ameritrade's website
1 Minute Review

This publicly listed discount broker, which is in existence for over four decades, is service-intensive, offering intuitive and powerful investment tools. Especially, with equity investing, a flat fee is charged, with the firm claiming that it charges no trade minimum, no data fees, and no platform fees. Though it is pricier than many other discount brokers, what tilts the scales in its favor is its well-rounded service offerings and the quality and value it offers its clients.

Pros
  • Superior technology
  • No account minimum balance
  • Excellent customer support
  • Premier data and news partnerships
Cons
  • Slightly higher commissions
  • Can be for more advanced users
Current Promotion

Trade commission–free for 90 days & get up to $2500

Ally Investment
  • Active traders
  • Beginners looking to start trading
  • Low fees
  • Penny stocks
$4.95 volume discount available $0
Get started securely through Ally Investment's website
1 Minute Review

If investors are on the hunt for a bargain broker, Ally Invest could be the one. With low commissions across the board, Ally Invest (formerly TradeKing) stops potential investors in their tracks with its especially low mutual fund commissions. Commissions on stocks and ETFs are notoriously inexpensive as well, and for more active traders or those with larger account balances, commissions can dip as low as $3.95 per trade.

Pros
  • Volume discounts available
  • Among the lowest fees in industry
  • Good for every experience level
  • Excellent customer service
Cons
  • No commission free ETFs
  • Lacks physical locations
Current Promotion

$3.95 per stock trade for Active Traders at Ally Invest

eTrade
  • Mobile traders
  • Traders looking for research and data
  • Investors looking for retirement planning guidance
$6.95 for fewer than 30 trades/quarter. $0
Get started securely through eTrade's website
1 Minute Review

E-Trade is best known for its user-friendly browser, desktop and mobile trading platforms and its extensive research and educational information. E-Trade may not have the lowest commissions compared to discount online brokers, but customers certainly get their money’s worth from E-Trade’s comprehensive offerings.

Pros
  • Extensive resources
  • Full banking services
  • Easy-to-use platforms
Cons
  • Limited access to ETrade Pro
  • Higher commissions than discount brokers
Current Promotion

60 days of commission-free trades with deposit of $10,000 or more

Wealthfront
  • Passive investors
  • Lower fees
  • Beginning investors
  • Investors who don't want to manage money on their own
0.25% annual fee $500
Get started securely through Wealthfront's website
1 Minute Review

Wealthfront offers automated investment services, customized according to the risk tolerance and investment goals of every investor. For assessing clients basic financial health, Wealthfront has designed a financial planning solution called Path. If you link all your accounts, Path can analyze your financial habits and help you determine where are your habits going to lead you in the future. Investors who wish to invest their savings can use an automatic investing feature called PassivePlus at low cost. It offers the following strategies: Tax-Loss Harvesting, Stock-level Tax-Loss Harvesting, Smart Beta and Risk Parity.

Pros
  • Relatively small fess
  • Goals and risk tolerance based strategies
  • Time-tested and academically proven investment strategies
  • Tax optimization
  • Financial planning and results tracking
  • Referrals program
Cons
  • No partial shares allowed
  • Doesn't invest entire deposit
Current Promotion

None at this time

Betterment
  • Intermediate investors
  • Retired investors
  • College students
0.25% annual fee for accounts 0.4% Premium Plan with additional features annual fee for accounts more than $100,000 $0
Get started securely through Betterment's website
1 Minute Review

Offering personalized investment strategies, Betterment tailors customer portfolios based on a host of factors such as goal type, risk tolerance, account type, time horizon etc. The firm focuses on tax-efficient investing at all stages, which is its unique selling proposition.

Pros
  • Built in tax-saving strategies
  • Automated rebalancing
  • Personalized service
Cons
  • Lack of customization
  • Other Robos can be free
Current Promotion

None at this time

Vanguard
  • Set-it-and-forget it investors
  • Saving on taxes
  • Complex financial planning for retirement
0.30% annual fee $50,000
Get started securely through Vanguard's website
1 Minute Review

Vanguard Personal Advisor Services combines the best of high-touch, high-tech, and low-cost funds to help you with your real-life investing needs.

Pros
  • Low-cost investing available for Vanguard funds
  • It’s a great company for DIY investors
  • Vanguard still has many options for investors who would like to speak with an advisor
Cons
  • No active trading platform or tools
  • Other funds are more expensive to invest in; your best bet is to invest in Vanguard’s own funds
  • No advanced platform available
Current Promotion

None