Best IRA Accounts of 2021

An individual retirement account, also known as an IRA, is an investment tool for retirement savings. IRA accounts are tax-advantaged, meaning you don’t pay taxes on what you contribute to the account until after retirement when the withdrawal period starts. The best IRA accounts offer customers great investing options and low fees over the long term.

Many of the best IRA accounts are found at the same places where you’d open up an online stock trading account. These are all great choices, but you ought to look at your retirement accounts with a different set of eyes. Where retirement is concerned, you probably shouldn’t be actively trading; slow and steady, with minimal hassle, wins the race.

In this article

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    The 8 best IRA accounts of 2021

    ProviderMinimum DepositOnline Trading FeePromotion
    TD Ameritrade IRA$0nonenone
    Fidelity IRA$0none500 free trades
    Betterment IRA$00.25%Up to one year of free management
    Vanguard IRA$1,000$20none
    Charles Schwab IRA$0nonenone
    E*TRADE IRA$0nonenone

    Best IRA accounts – TD Ameritrade

    TD Ameritrade is ranked as one of the best online brokers for both trading and long-term investing.

    Minimum Deposit
    $0.00
    Fees
    $0.00
    Customer Satisfaction Score
    796/1,000
    SimpleScore
    4.2 / 5.0
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    SimpleScore TD Ameritrade 4.2
    Min. Deposit 5
    Fee 5
    Customer Satisfaction 2
    Resources 4
    Support 5

    TD Ameritrade is ranked as one of the best online brokers for both trading and long-term investing. As a client, you have access to any resource you need, from banking services to advanced trading tools, as well as face-to-face customer support at hundreds of brick-and-mortar branches nationwide. TD Ameritrade IRA accounts feature no account minimums and access to more than 300 no-fee ETFs. It’s a good choice for investors of all experience levels as well as beginners who want access to great customer support.

    Best for active trader – Fidelity

    Fidelity makes it as easy as possible to perform an IRA rollover from another institution. There are no annual fees and online U.S. equity trades cost just $4.95 each.

    Minimum Deposit
    $0.00
    Fees
    $0.00
    Customer Satisfaction Score
    800/1,000
    SimpleScore
    4.2 / 5.0
    close
    SimpleScore Fidelity 4.2
    Min. Deposit 5
    Fee 5
    Customer Satisfaction 2
    Resources 4
    Support 5

    You won’t need a minimum deposit to open a traditional IRA with Fidelity and you also won’t be charged a steep monthly fee. You may, however, need to reach a certain threshold to invest in some of Fidelity’s mutual funds. Other available investment vehicles include ETFs, stocks, bonds, and CDs.

    Best for long-view investors – Betterment

    Betterment is an online investment platform that helps individuals plan their retirements with a variety of handy online tools.

    Minimum Deposit
    $0.00
    Fees
    0.25%/year
    Customer Satisfaction Score
    N/A
    SimpleScore
    4.5 / 5.0
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    SimpleScore Betterment 4.5
    Min. Deposit 5
    Fee 4
    Customer Satisfaction N/A
    Resources 4
    Support 5

    Betterment also features a five-minute account setup, no account minimum, and no minimum for withdrawals or deposits. Betterment is good for knowledgeable investors who want to “set it and forget it,” people looking to rollover a 401(k) and novices who are interested in learning as they go.

    Best for experienced investors – Vanguard

    A traditional IRA from Vanguard gives you access to more than 100 free mutual funds.

    Minimum Deposit
    $1,000.00
    Fees
    $20.00/year
    Customer Satisfaction Score
    820/1,000
    SimpleScore
    3.6 / 5.0
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    SimpleScore Vanguard 3.6
    Min. Deposit 3
    Fee 4
    Customer Satisfaction 3
    Resources 4
    Support 4

    For total ease of investment, consider selecting a target retirement fund. Each one is named by the approximate year in which you plan to retire. Rather than charging an annual percentage of your total assets under management, Vanguard charges an annual $20 for each mutual fund or ETF in your portfolio. It is possible, however, to get this fee waived when you sign up for e-delivery service. The fees are also automatically waived when you reach $10,000 in your account. Vanguard does have a relatively steep minimum deposit threshold of $1,000, so it’s not a good option for investors who haven’t already saved up a chunk of cash.

    Best for customer support – Charles Schwab

    Charles Schwab is known for its customer support and service.

    Minimum Deposit
    $0.00
    Fees
    $0.00
    Customer Satisfaction Score
    819/1,000
    SimpleScore
    4.4 / 5.0
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    SimpleScore Charles Schwab 4.4
    Min. Deposit 5
    Fee 5
    Customer Satisfaction 2
    Resources 5
    Support 5

    It takes care of its clients, regardless of how much money they’ve invested. At $4.95 per trade, Charles Schwab’s stock, ETF and option fees are among the most competitive in the industry, and you’ll find many mutual funds that are almost completely free of fees. You can decide whether you want to be active or more passive in managing your account without having to worry about meeting a required trading volume. Charles Schwab also features extensive retirement planning resources and tools and is a good fit for new investors as well as those looking for dedicated customer support.

    Best for no-fee mutual funds – E*TRADE

    E*TRADE is a well-known online broker, offering access to every investment product and resource you could need.

    Minimum Deposit
    N/A
    Fees
    N/A
    Customer Satisfaction Score
    787/1,000
    SimpleScore
    4.2 / 5.0
    close
    SimpleScore E*TRADE 4.2
    Mobile App 4
    Products 5
    Resources 4
    Support Channels 4
    Customer Satisfaction 4

    While commissions on stock trades are higher than average, E*TRADE allows customers to invest in over 9,000 mutual funds, more than 4,400 of which have no transaction fee. E*TRADE is a good fit for people who want a variety of investments in their IRA, low-frequency traders and long-term mutual fund investors.

    Betterment is an online investment platform that helps individuals plan their retirements with a variety of handy online tools. Betterment also features a five-minute account setup, no account minimum, and no minimum for withdrawals or deposits. Betterment is good for knowledgeable investors who want to “set it and forget it,” people looking to rollover a 401(k) and novices who are interested in learning as they go.

    Best for real estate investing – Fundrise

    Fundrise is known for opening the doors of commercial real estate to ordinary investors.

    Minimum Deposit
    $500.00
    Fees
    0.85%/year
    Google App Store Rating
    4.75/5
    SimpleScore
    3.5 / 5.0
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    SimpleScore Fundrise 3.5
    Min. Deposit 4
    Fee 3
    Customer Satisfaction N/A
    Resources 3
    Support 4

    You can also invest in its eREITS through a tax-advantaged IRA. You’ll pay $75 a year for each eREIT in which you invest, although the total is capped at $125. On top of that, there’s a 0.15% advisory fee and a 0.85% management fee. Fundrise investors can choose between three different plans based on your goals. Supplemental Income is focused on dividends to give you a higher return, Balanced Investing balances dividends with appreciation, while Long-Term Growth lowers your level of dividends to focus on appreciation of your IRA.

    What is an IRA?

    An IRA, or individual retirement account, is a tax-advantaged investment account designed to help you save for retirement. An IRA is one of the best ways to invest your money to take advantage of tax breaks, whether you receive them upfront (with a traditional IRA) or when you withdraw your money tax-free later in life (as with a Roth IRA). Those tax benefits come with some restrictions, however, and you’ll generally incur a penalty if you withdraw funds from a traditional IRA before you’re 59.5 years old.

    How should I choose the right IRA?

    When choosing an IRA, you should determine which provider best suits your needs, and then decide whether you’d prefer to open a Roth IRA or a traditional IRA. Roth IRAs are best for young adults without large incomes and those who want the flexibility to take out investments before retirement. Traditional IRAs are best for high earners who want to reduce their taxable income each year, and adults who start an IRA account later in life.

    What if I want to switch/rollover my IRA?

    Rollovers occur when retirement funds are transferred into a traditional IRA or Roth IRA from another retirement savings account. Most IRA accounts accept rollovers. The most common rollovers are from a 401(k) or a 403(b) workplace retirement plan. You’ll want to do a rollover IRA if you have retirement savings from your previous job. If you have multiple retirement accounts, it also makes sense to consolidate your investment accounts in one place at some point.

    We welcome your feedback on this article and would love to hear about your experience with the IRAs we recommend. Contact us at inquiries@thesimpledollar.com with comments or questions.

    Methodology

    SimpleScore

    The SimpleScore is a proprietary scoring metric we use to objectively compare products and services at The Simple Dollar.

    For every review, our editorial team:

    • Identifies five measurable aspects to compare across each brand
    • Determines the rating criteria for each aspect score
    • Averages the five aspect scores to produce a single SimpleScore

    Here’s a breakdown of the five aspect scores and their rating criteria for our review of the best IRAs and Roth IRAs of 2020.

     

    Why do some brands have different SimpleScores on different pages?

    To ensure the SimpleScore is as helpful and accurate as possible, we developed unique criteria for every category we compare at The Simple Dollar. Since most brands offer a variety of financial solutions, their products and services will score differently depending on what we’re scoring on a given page.

    However, it’s also possible for brands to have multiple SimpleScores. For example, when we apply our methodology to TD Ameritrade’s IRA products, it scores a 4.2 out of 5. However, in our stock trading SimpleScore review, it scores a 3.8 out of 5. While the two products are similar, we created separate rating criteria for the two products based on industry standards.

    Questions about our methodology?

    Email Hayley Armstrong at hayley@thesimpledollar.com.

    Minimum deposit

    How much do customers have to deposit when opening an account? We reviewed the minimum deposit requirements for each brand and assigned a score accordingly.

    Fee

    Many IRA accounts charge a fee, but we scored brands higher if they have low or no fees associated with the account.

    Customer satisfaction

    We leveraged J.D. Power’s 2020 U.S. Self-Directed Investor Satisfaction Study to rate each brand in customer satisfaction. If the brand was not scored, we simply averaged the other four scores.

    Resources

    We reviewed the resources available to customers for each brand. Resources such as market insights, instructional blogs, Morningstar reports and more were considered in this metric aspect.

    Customer support

    When customers need support from the IRA account provider, it’s important that they have options. We reviews brands based on the number of channels of support offered to customers.

    Margaret Wack

    Contributing Writer

    Margaret Wack writes about personal finance, health, wellness, arts and culture, among other topics.

    Reviewed by

    • Courtney Mihocik
      Courtney Mihocik
      Loans Editor

      Courtney Mihocik is an editor at The Simple Dollar who specializes in personal loans, student loans, auto loans, and debt consolidation loans. She is a former writer and contributing editor to Interest.com, PersonalLoans.org, and elsewhere.