Individual Retirement Accounts (IRAs) allow investors to save for retirement with tax advantages. Traditional IRA contributions can be deducted from income while Roth IRA withdrawals are tax-free.
Betterment offers low flat fees to manage IRAs and offers useful features like tax loss harvesting and auto-rebalancing, while Schwab offers commission-free stock and options trades plus thousands of no-fee mutual funds.
Betterment
Betterment is an online investment firm offering advice and brokerage services for an IRA account. They offer various portfolio options at low fees with tax loss harvesting capabilities as well as automatic rebalancing to keep accounts balanced over time. Furthermore, Betterment supports traditional, Roth, SIMPLE SEP, and rollover IRAs with no minimum account balance requirements or restrictions imposed upon them.
BlackRock Target Income Portfolios carry a low management fee of just 0.25% and other portfolios can be found with lower fees. In addition, investors may link external accounts for personalized advice as well as use fractional shares that help minimize trading costs.
Fees associated with an IRA account should be carefully considered, as they can have an enormous effect on how your money grows over time. You can shop around for the best deal and reduce fees by investing in low-cost funds that track market indexes; additionally, consider robo-advisors who charge lower fees than traditional investment brokers.
Schwab Intelligent Portfolios
Schwab stands out as an investor-friendly robo-advisor by offering an extremely low management fee of nothing (after paying one-time setup fees). Their platform also provides free portfolio management and rebalancing; tax loss harvesting ($50 minimum investment required). Schwab also adheres to best practices when investing taxable accounts as well as including municipal bond ETFs within its portfolios.
Schwab Intelligent Portfolios stands out from its competition by holding between 6% to 30% of clients’ assets in cash, which helps ensure full portfolio diversification; however, investors with lower risk tolerance may find this approach less appealing. Furthermore, it only supports taxable accounts of $50,000 or higher.
Schwab offers customizable portfolios and 24-hour U.S. customer support through phone, chat or in its physical branches. Schwab supports an array of account types such as individual and joint taxable brokerage accounts; traditional, Roth and SEP IRAs; trusts (UGMA/UTMA, community property and revocable living trusts); as well as its robo-advisor customers having unlimited access to certified financial planners.
TD Ameritrade
TD Ameritrade boasts of being the top choice for individual retirement account investors to “Grow Smarter(r).” Their extensive fund selection (which includes thousands of no-load funds), research and news updates as well as user-friendly tools and resources make this claim hard to argue against.
The company is dedicated to protecting their clients’ assets, and as part of SIPC provides up to $500,000 protection for securities and cash in client brokerage accounts. Furthermore, it offers its clients a cash sweep program which transfers idle money into an FDIC-insured money market account.
TD Ameritrade stands out among the competition with an impressive list of features, but perhaps what sets it apart most of all is its no account maintenance fee for traditional and Roth IRAs – something NerdWallet writers take great care in using primary sources as sources for their writings.
Vanguard
Vanguard may be known for low-cost investing, but that doesn’t make them your only option. Their massive size gives them access to 13% of industry management fees in 2024 alone!
Vanguard provides investors with commission-free trading online of stocks and ETFs, boasting some of the lowest fund expense ratios in the industry. Furthermore, this firm does not charge back-end or front-end load fees that can add up over time.
Vanguard’s Digital Advisor robo-advisor provides an introductory fee waiver period, beginning when your first account is opened with them. Additional accounts enrolled may not qualify for this waiver period as investing involves risk and could potentially involve loss of principal; neither Vanguard nor NerdWallet guarantee profits or protection against losses; please see here for our full disclosures.
