Best IRA Accounts in 2020 - Roth & Traditional, Rates & Fees

IRA stands for an individual retirement account. The money you invest in it will grow over time at a certain interest rate. But unlike with 401(k) plans, you have complete control over these funds. In this article, we set out to find the best IRA accounts. We’ve covered:

  • Our methodology
  • Reviews
  • IRA ins and outs
  • Buyer’s guide
  • FAQ

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IRA Saving Accounts - Reviews

1. Betterment

Discount for over $2 million

Affordable

Globally diversified portfolio

Best for inherited IRA accounts

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Betterment ensures that its clients invest with optimal risk, tax-smart features, and auto-deposits. It works with beneficiary IRA accounts, offers advice during big life changes, and even provides a discount.

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Pricing

Ease of Use

Credibility

Variety of Options

2. Ally Invest

Cash bonus available

Additional CD and savings account products

Hands-on and hands-off options

Best for those close to retirement

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Whether you’re a hands-on or a hands-off investor, Ally Invest has something to offer you. You can choose between several products, each with a great APY, making it the best company for those close to retirement.

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Pricing

Ease of Use

Credibility

Variety of Options

3. SoFi

No fees for accounts under $10,000

Hands-on and hands-off accounts available

Planning and investment tools and resources

Best for young professionals

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SoFi gives you all the necessary tools and resources when starting an IRA account. Choose between several IRA account types, pick self-directed or robo-advisory mode, and all with no fees for accounts under $10,000.

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Pricing

Ease of Use

Credibility

Variety of Options

4. Ellevest

Affordable plans

Takes gender differences into consideration

Learning and coaching

Best for women

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Ellevest is the best choice for women wanting to save for retirement. By taking into consideration variables specific to them, and offering coaching and learning, it ensures women save as much as possible.

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Pricing

Ease of Use

Credibility

Variety of options

5. Wealthfront

Research-backed planning

Affordable

FDIC-insured

Best for young people

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Wealthfront creates retirement plans based not only on your habits but on research-backed economic analysis and predictions. It also helps you adjust to big life changes, making these the best IRA accounts for young people

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Pricing

Ease of Use

Credibility

Variety of Options

6. E*Trade

Benefits for those over 59 ½

IRA for minors

Rollover guidance

Best for working minors

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E*Trade is a great choice for all ages. There are IRA accounts for minors, benefits for those over 59 ½, and everything is managed by a perfect mix of human expertise and advanced technology.

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Pricing

Ease of Use

Credibility

Variety of Options

7. TD Ameritrade

Customized and automated portfolio management

Multiple plans for business owners

No management fees

Best for those whose first language is Chinese/Taiwanese

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TD Ameritrade is one of the best brokers in terms of IRA accounts. Plenty of account types, tools, resources, and even additional languages all come with a $0 management fee.

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Pricing

Ease of Use

Credibility

Variety of Options

8. Merrill Edge

Handles the rollover process

User-friendly mobile app

Up to $600 bonus for new customers

Best for Bank of America clients

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Merrill Edge is a well-known company. Its IRA account services are perfect for Bank of America clients. Choose between a self-directed or guided approach, get help with rollovers, and you may even gain up to $600.

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Pricing

Ease of Use

Credibility

Variety of Options

9. M1 Finance

Intuitive and user-friendly mobile app

Pie portfolios

Hands-on and hands-off options

Best for hands-on investors

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If you’re an experienced investor and prefer the hands-on approach, M1 Finance offers the best IRA accounts for you. A pie-based portfolio will show you exactly how your assets are performing, and with no management fees.

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Pricing

Ease of Use

Credibility

Variety of Options

10. Firstrade

Intuitive mobile app

No management, setup, or termination fees

Chinese language available

Best for beginners

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For beginners who want to open an IRA account with no management fees, and those whose first language is Chinese, Firstrade is a great choice. On top of it all, the rollover process is a breeze.

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Pricing

Ease of Use

Credibility

Variety of Options

Our Methodology

In order to find top-of-the-class IRA accounts, we looked at a couple of characteristics. For one, how many IRA types does a certain company offer? Is managing the account expensive? How easy or difficult is it to open an account? Here’s everything we based our choices on:

  • IRA types. It’s important that a company provides several different IRA types to its clients. On our list of the best IRA accounts of 2020, we’ve included companies offering traditional, Roth, and rollover IRAs, as well as those aimed at small businesses.
  • Pricing. Whether they have a membership-based model or take management fees, the companies we chose offer affordable services.
  • Ease of use. All of these companies have a simple, intuitive sign-up process and offer a user-friendly insight into your funds. As a bonus, most of them have a mobile app for additional convenience.
  • Credibility. Finding the best companies for IRA accounts also meant making sure that they’re well renowned and trustworthy.
  • Contribution limits. The industry standard is $6,000 ($7,000 if you’re over 50). Therefore, we went with companies that either have those same limits or close to these.
  • Customer support. When you’re willingly giving a company your money, knowing its customer service is responsive and ready to help is very important.

At a Glance

  • Affordable
  • Discount for over $2 million
  • Globally diversified portfolio
  • No hands-off option
  • SEP IRA is only for business owners with no employees

Betterment is a financial advisory company founded in 2008. Besides robo-advisory, it also provides cash management services. To get the best return on IRA accounts, the company offers a Betterment Portfolio Strategy that helps clients invest with optimal risk.

Not only do you get a globally diversified portfolio, but you can also choose between traditional, Roth, SEP, and even 401(k) plans. In case you’re looking for a rollover, Betterment is a great choice. The process can be automated, or the company itself will help you with it. Additionally, you can move an inherited IRA (also known as beneficiary IRA) via a trustee-to-trustee transfer.

Once you sign up, you’ll get advice on how much to save based on how much you want to spend in retirement. Next, Betterment helps you choose the ideal type of an IRA saving account. Advisors will then customize your plan with tax-smart features and auto-deposits. Once all is in motion, you’ll constantly be kept up-to-date. For more convenience, there’s a mobile app, though its features are somewhat limited compared to the website.

There are two plans to choose from, Digital and Premium. For the former, 0.25% is taken off your balance every year, while the percentage for the latter is 0.40%. The more affordable plan is a good fit if you want something fairly simple, or you’re looking for the best rollover IRA accounts. But if you want support and advice during big life changes like having a child or buying a house, a Premium plan is right for you. You can cancel at any time with prorated fees, and withdraw money whenever you want. There’s even a 0.10% discount if your household balance is above $2 million.

At a Glance

  • Additional CD and savings account products
  • Hands-on and hands-off options
  • Cash bonus available
  • Minimum account investment for managed portfolios is $100
  • Mobile app comes with some glitches

This award-winning stock brokerage was founded in 2005. It’s among the best companies for IRA accounts if you’re looking for additional products such as a high-yield CD.

With Ally Invest, you can open a traditional, Roth, or a SEP IRA account. There’s also an option to roll over, although Ally Invest doesn’t offer help with it. For those who are close to retirement or who don’t want their IRA account depending on the market, there’s Ally Bank IRA. Thanks to great CD and savings account options, it’s among the best banks for IRA accounts. With an IRA CD, your interest rate is either fixed, or it grows. The savings account starts at 0.60% annual percentage yield (APY), which is more than 10 times the national average. These products are FDIC-insured.

To begin, choose your IRA account type, add one of the products (optional), and then opt for either a hands-on or hands-off approach. With self-directed training, you get:

  • In-depth research
  • Market analysis tools
  • Investment choices like commission-free ETFs, stocks, mutual funds, etc.

These are some of the best self-directed IRA accounts out there. To create a managed portfolio, you need to start with $100, but you’ll be getting a customized plan, recommendations, and optimizing.

Whichever you choose, you can take advantage of a mobile app, though it’s been having some hiccups with the latest update.

Ally Invest has a couple of fees you should keep in mind:

  • Closure fee – $25
  • Partial account outgoing transfer fee – $50
  • Full account outgoing transfer fee – $75

Additionally, there’s a 0.30% fee if you choose a market-focused managed portfolio. If you’re looking for the best IRA rates for a great value, it doesn’t get much better than this. The good news is, new clients can receive up to a $3,500 cash bonus if they fund accounts within 60 days of opening them.

At a Glance

  • Hands-on and hands-off accounts available
  • No fees for accounts under $10,000
  • Planning and investment tools and resources
  • Somewhat high fee for a wire withdrawal
  • The investment part of the app isn’t user-friendly

Founded in 2011, this company offers quite a few services: mortgages, student loan refinancing, personal loans, investing, etc. No account fees, both hands-on and hands-off options, and a huge suite of planning and investment tools make these the best IRA accounts for young professionals.

SoFi offers traditional, Roth, and SEP IRA accounts. You can rollover your 401(k), and there are plenty of resources on the company’s website to help you out. The process of starting out is very user-friendly. Signing up takes less than two minutes, and once you’re good to go, you’ll choose the type of account you wish to open. SoFi’s smart technology can help you pick the best mix of investments based on your plans and age if you prefer having a robo-advisory account. Otherwise, choose a self-directed approach. The company strongly suggests investing your money in mutual funds or some other method rather than just keeping it in the account. Auto deposits are available, and for more convenience, there’s a mobile app. Its money portion is of great help to users. The investment part, however, isn’t as user-friendly. Luckily, the website is.

If you’re looking for the best low-cost IRA accounts, SoFi is a great choice. The minimum account investment is $1, and there are no account fees for portfolios below $10,000. Once you’re above that threshold, the price is 0.25% a year. The only downside is that the wire withdrawal fees are $25.

At a Glance

  • Takes gender differences into consideration
  • Learning and coaching
  • Affordable plans
  • Difference between Plus and Executive not that stark
  • No retirement options with the basic plan

This company has a mission to help women invest and save money by taking their unique struggles into consideration. Founded in 2014, Ellevest was made with women’s pay gap, longer life span, and career breaks in mind. As a woman, here’s where you can create the best IRA account for your needs.

Whether you want to start a traditional, Roth, or SEP account, Ellevest has you covered. You can also roll over your 401(k) or even transfer an existing IRA account. As a member, you’ll also get access to workshops, courses, and coaching, so you learn all about saving and investing. Track your goals is easy with monthly reports.

Once you choose the account type (be it the traditional, SEP, or the best Roth IRA for women), Ellevest will create a customized investment plan. The company will invest and manage your money. However, as monthly reports roll in, you can adjust the plan yourself by putting the knowledge you’ve gained into action. This gives you a certain amount of control over where your money goes. The company also uses a mobile app, though it can be buggy.

There are three plans at Ellevest, though only Plus and Executive include IRA accounts. Plus starts at $5/month and gives you 30% off coaching. The Executive plan has a 50% discount on coaching and provides multi-goal investing, all for $9/month. If you’re looking for the best IRA with no hidden fees, these accounts are a great choice.

At a Glance

  • Affordable
  • Research-backed planning
  • FDIC-insured
  • No direct help with rollovers
  • Minimum account investment is $500

This robo-advisor was founded in 2008 with the aim of helping people plan, save, and invest. All plans are research-backed and created by advisors with PhDs. That way, you’re getting the most foolproof plans possible. On top of that, your money is FDIC-insured up to $1 million, and APY is 0.35%.

Whether you’re looking for the best traditional IRA accounts, Roth IRA, or SEP, Wealthfront has you covered. You can also roll over your 401(k) or an existing investment account. Though the company doesn’t offer direct help, it explains the process so you can do it as easily as possible.

Once you opt for a certain IRA account, Wealthfront gets to work. When you link your financial accounts, the team of PhDs starts analyzing your habits and crafting a plan that helps you adjust to big life changes. What puts these among the best managed IRA accounts is the inclusion of economic factors like Social Security and inflation.

Wealthfront’s retirement services are affordable. You’d be giving the company a yearly advisory fee of 0.25%, and there are no withdrawal or transfer fees. One downside is that the minimum account investment is $500.

At a Glance

  • IRA for minors
  • Benefits for those over 59 ½
  • Rollover guidance
  • No hands-on accounts
  • Funds needed right away

Founded in 1982 as a subsidiary of Morgan Stanley, this company provides an electronic trading platform. It allows the trading of assets like exchange-traded funds, options, mutual funds, and futures contracts. When it comes to IRA accounts, they’re the perfect combination of human expertise and technology.

The company offers not only traditional, Roth, SEP, and beneficiary IRA accounts, but the best individual IRA accounts for working minors as well. If you need to have a rollover, you’ll be guided through the whole process. E*Trade offers special benefits to those over 59 ½ in the form of immediate withdrawal at any time, with no forms needed, and immediate access to IRA savings. They also get free checks, debit cards, and online Bill Pay.

You can easily open your account with E*Trade via phone, email, or website. Once you fill in the application and add some funds, the company starts its work. From there, the company’s strategy team will choose the investments, while smart technology manages your portfolio. No wonder these are among the best IRA managed accounts.

E*Trade doesn’t have a management fee, but it has a couple of other fees:

  • Withdrawal before the age 59 ½ – $25
  • Excess contribution removal – $25
  • Recharacterization (changing contribution from traditional to Roth account or vice versa) – $25.

At a Glance

  • Multiple plans for business owners
  • Customized and automated portfolio management
  • No management fees
  • The mobile app is buggy at times
  • High wire transfer fee

This award-winning broker was founded in 1975. It offers an electronic trading platform for financial assets like common stocks, options, and cryptocurrency. When it comes to the IRA saving account, we chose this company for our list due to the variety of options for small business owners, as well as its availability in Chinese and Taiwanese languages.

Though TD Ameritrade offers traditional and Roth IRA accounts, and even allows rollovers, its main selling point is elsewhere. The company offers not only SEP IRA accounts, but SIMPLE and even Solo 401(k) ones. While SEP and Solo 401(k) are generally aimed at business owners, SIMPLE is there to cover employees. A single company can take care of all of your needs. No wonder many see these as the best IRA accounts for 401k rollover.

Once you create an account, you can choose between automated portfolio management or a customized plan. If you opt for the latter, there are plenty of resources, tools, and solutions to help you out.

There’s even a mobile app for more convenience. It has a great design, though it suffers from occasional bugs.

When it comes to both investments and retirement, there are no management fees. The only fees when it comes to IRA accounts are $75 for the outbound full account transfer and $25 for wire withdrawal. For not only the best SEP IRA but SIMPLE and Solo 401(k) as well, it’s a truly small price to pay.

At a Glance

  • User-friendly mobile app
  • Handles the rollover process
  • Up to $600 bonus for new customers
  • Somewhat high fees
  • The mobile app has occasional bugs

This award-winning company has a history that starts back in 1914. Previously branded as Merrill Lynch, it’s a division of the Bank of America. If you’re already a member of this bank, you’ll have a seamless experience opening an IRA account with Merrill Edge.

The company offers plenty of IRA account types – traditional, Roth, SEP, SIMPLE, 401(k) – but it truly shines with rollovers. The best IRA rollover accounts are a consequence of their dedication to clients. The company not only walks you through the entire process but also calls your old provider and requests funds transfer.

When you’re starting out, after choosing the type of IRA account, you’ll be prompted to pick either self-directed or guided account management. With the self-directed option, the company helps you via the Quick Start Guide. You’ll find out everything about choosing investments and managing your portfolio. Those who want the best interest rates on IRA accounts usually go with the guided option. In that case, the company will either provide you with a recommended investment strategy, or you’ll meet with an advisor to further discuss it. Their simple mobile app should help you if you can look past a few bugs.

Should you opt for guided investing, expect an annual fee of 0.45%. If you want to work with an advisor, that fee will be 0.85%. There’s also a fee of $49.99 for a full outgoing account transfer. Though Merrill Edge may not offer the best rates for IRA accounts, the company does offer a bonus. If you’re a new customer with a balance starting at $20,000, you’re eligible for a bonus of up to $600.

At a Glance

  • Pie portfolios
  • Intuitive and user-friendly mobile app
  • Hands-on and hands-off options
  • High termination fee
  • Not many tools to help with hands-off investing

This registered broker dealer was founded in 2015. Since then, it’s been known for its user-friendly pie-based interface. This interface offers full transparency when it comes to assets and investments, resulting in some of the best online IRA savings accounts.

You can choose between a traditional, SEP, and Roth IRA. To start, choose the Retirement option when creating an account. Once you link your bank account, you can choose what kind of portfolio you want: one with your own securities or something created especially for you by M1 Finance’s experts. Though you can choose your own portfolio, M2 Finance doesn’t offer many tools to help you do so, so it’s mostly for experienced investors. The inexperienced clients can get the best funds for IRA accounts by receiving professional help. Experts will consider your goals, ability to tolerate risk, as well as the time you have to invest. Once your portfolio is set, you can easily track it through an intuitive mobile app. Each slice of the pie represents an asset and you can easily track its behavior over time.

M1 Finance has no management fees, but it does have a couple of other fees:

  • IRA Termination Fee – $100
  • IRA Conversion Fee – $25
  • Inactivity fee (up to $20 on account & inactive for 90+ days) – $20.

At a Glance

  • No management, setup, or termination fees
  • Chinese language available
  • Intuitive mobile app
  • Not too much information on the website
  • Hidden fees

Founded in 1985, this stock brokerage firm provides an electronic trading platform for financial assets such as stocks, exchange-traded funds, and mutual funds. It’s available in Chinese, making it a great choice for all those opening an IRA account in the U.S., whose native language is Chinese.

Firstrade offers traditional, Roth, SEP, and even SIMPLE IRA, something small business owners appreciate. With plenty of resources on different IRA types, it provides the best IRA accounts for beginners. Another proof of that is the rollover process. An expert from Firstrade will provide step-to-step guidance for a quick and seamless rollover. The intuitive mobile app is another way to stay up-to-date, though it suffers from occasional bugs.

Firstrade proudly states that it charges absolutely no fees. While that’s true for the most part, there are some exceptions. There are no management, setup, or termination fees. Trading stocks are commission-free as well, but there are certain events that will incur a fee nonetheless. The ones related to IRA accounts are:

  • Exercising an options position in an IRA account – $14.95
  • Minimum investment amounts for buying mutual funds – $500 for the first and $100 for subsequent investments
  • Transferring foreign securities into/out of IRA – $75
  • Full IRA account transfer – $75
  • Partial IRA account transfers – $55
  • Wire transfers up to $30

It’s always good to know exactly what kind of IRA rates you can expect.

How to Choose the IRA Account That Best Suits Your Needs

No matter how great all IRA accounts we’ve reviewed are, they don’t all suit everyone. What the best IRA accounts for you are depends on your plans and preferences. Here is what you need to ask yourself to choose the right IRA account:

  • How do you want to invest? If you’re an experienced investor, you likely want a hands-on account. Otherwise, finding a company that takes over portfolio management is a better choice.
  • What are your options? You can create an IRA account in multiple places: banks, mutual fund companies, insurance companies, with brokers, etc. The question is, which one will benefit you most? If you already have a bank account and that same bank provides IRA accounts, it makes sense to go for it. If you prefer investing the money in your IRA account to get the highest Roth or traditional IRA interest rates, you’ll benefit from a different provider.
  • Monthly fees/interest rates. Do you prefer having a fixed monthly fee, or having a yearly interest rate? Some companies offer one, some the other.
  • Savings account or CD? If you want to have the option of withdrawing money at will, having a savings account is the right choice.
  • However, if you don’t plan on touching your investments for a certain period of time, choosing CDs is a much better choice, as they come with higher interest rates.
  • Investment guidance/advisor? If you need some guidance or even a professional advisor when it comes to your IRA account, choose the companies which provide them, rather than those offering only hands-on accounts.
  • Are there any management fees? How high are they? If you’re comfortable with paying management fees, find the company whose prices you’re okay with. There are companies that don’t have management fees whatsoever. While you should be looking for the best IRA rates, this shouldn’t be the main variable you base your decision on.

What Is an IRA? - Types and Advantages

An IRA is an individual retirement account, independent of 401(k) and offering plenty of benefits. You can choose to simply add funds to it, or invest via stocks, mutual funds, and other financial assets, in order to get the best possible result. There are several types of IRA – traditional, Roth, and SEP being the most common. There’s also a rollover IRA, but it’s not a separate IRA type per se. It simply means you’re transferring funds from an employer-sponsored (usually 401(k)) plan to an IRA.

The main difference between the Roth and traditional IRA lies in when your money will be taxed. With the best traditional IRA accounts, you make contributions with money that isn’t taxed until you withdraw it. If you’re in a lower tax bracket when you start withdrawing it, your earnings will have grown if your account is tax-deferred.

With Roth IRA accounts, your money is taxed right away, meaning that the money will be tax-free by the time you withdraw it.

SEP IRA is aimed at small business owners or the self-employed. Their employees are also covered by SEP. On the other hand, Solo 401(k) plans cover business owners only. There are also SIMPLE IRA accounts which represent employer-sponsored retirement funds, an alternative to 401(k). The great thing about them all is the complete control business owners have over them.

Finally, when a loved one passes and their IRA account is transferred to you, it’s called an inherited or beneficiary IRA account.

What Is the Difference Between a Hands-on and Hands-off IRA Account

Which of these two types of IRA savings accounts (or CDs) are better for you depends on your preferences and experience as an investor. A hands-on IRA account means you have an active role in planning and optimizing your funds. You get to decide what to invest in, when, and how much. This type of IRA is likely to be best for experienced investors or those who are willing to learn a lot about investing.

If you’re not interested in investing yourself, a hands-off IRA is a better option. With it, you’re letting the IRA company do all the work when it comes to asset allocation, which usually results in the highest IRA rates. Nonetheless, it’s worth it. Specialists, technology, or both create a customized plan which will give you the best possible results. Some companies allow you to have a certain degree of choice. Once they create a plan, you can customize and adjust it.

How to Start an IRA

No matter what company you go with, starting an IRA account is a similar process. Here are the main steps:

  • Choose the type of account you want to open. Determine whether the best Roth IRA accounts or a traditional IRA would be a better fit for you. Or if you’re a business owner, choose SEP IRA or Solo 401(k).
  • Provide necessary information. Fill in the application form or provide the necessary information in other ways. Link your bank account and check whether you need to fund the IRA account right away.
  • Check withdrawal and contribution limits. Once all that’s done, make sure you know the company rules. If you contribute over the limit or withdraw money before a certain period, you could end up paying some fees.

Best IRA Accounts At A Glance

Betterment – Best for inherited IRA accounts
Ally Invest – Best for those close to retirement
SoFi – Best for young professionals
Ellevest – Best for women
Wealthfront – Best for young people
E*Trade – Best for working minors
TD Ameritrade – Best for those whose first language is Chinese/Taiwanese
Merrill Edge – Best for Bank of America clients
M1 Finance – Best for hands-on investors
Firstrade – Best for beginners

Key Takeouts

Having an IRA account ensures you have enough funds during your retirement to live a comfortable life. By choosing the type of account that best suits your needs, having a plan based on your style of life, age, and other variables, and choosing between different IRA providers, you get to customize your IRA account for maximum results. Guidance and advisors can help you make informed decisions, and you can even let experts do everything for you. No matter what your line of work is, how much money you make, and how old you are, it’s never too early nor too late to start thinking about your retirement funds.

FAQ

Can I lose all my money in an IRA?

Unless you invest your entire balance in a single individual stock or bond investment, it’s highly unlikely. Therefore, you should make sure your account is diversified enough to prevent any possibility of a total loss.

What are the benefits of an IRA account?

The main benefit is – you’re making sure you have money to live on once you’re retired. Other benefits include deciding how much to contribute, whether you want to simply pay or invest as well, and you can even get professional advice for the best results.

What is the difference between an IRA Saving Account and IRA CD?

With CDs, you have to let your money sit for a predetermined amount of time, and withdrawing it before that period ends will incur penalties. Savings accounts don’t have any of those limits but come with lower interest rates. Which of the two will end up being the best IRA accounts for you depends on your preferences.