Best IRAs of July 2024
“Verified by an expert” means that this article has been thoroughly reviewed and evaluated for accuracy.
“Verified by an expert” means that this article has been thoroughly reviewed and evaluated for accuracy.
BLUEPRINT
Updated 3:10 p.m. UTC May 20, 2024
Editorial Note: Blueprint may earn a commission from affiliate partner links featured here on our site. This commission does not influence our editors' opinions or evaluations. Please view our full advertiser disclosure policy.
Your individual retirement account’s success depends on more than investment selection. Beyond picking the best stocks or funds, choosing the right IRA provider helps you reap additional value-added perks and bonuses.
Our team evaluated more than 25 firms to find the best IRAs of 2024. We considered the account type availability, range of investment offerings, quality and breadth of educational resources, caliber of customer service, fee structure, and more.
Our partners
Datalign Advisory
Connect
Match with a financial advisor from a network of vetted fiduciaries.
Get started
Complete the questionnaire and match with an advisor for a free, no-obligation call.
Wealthramp
Find your match
Connect with fee-only advisors who fit your priorities
Build your wealth
Review your vetted advisor matches and set up a free consultation
J.P. Morgan Personal Advisors
Create a personalized financial plan
Get matched to expert-built portfolios, and receive ongoing advice and annual check-ins to ensure your plan is on track.
INVESTMENT AND INSURANCE PRODUCTS ARE: NOT A DEPOSIT • NOT FDIC INSURED • NO BANK GUARANTEE • MAY LOSE VALUE
Best IRAs
- Fidelity: Best overall.
- Charles Schwab: Best for educational resources.
- Interactive Brokers: Best for advanced DIY investors.
- E*TRADE from Morgan Stanley: Best for investing on a mobile app.
- Merrill Edge: Best for existing Bank of America clients.
- JPMorgan: Best for professional advising.
- Wells Fargo: Best for robo-advisory services.
- PNC: Best for self-employed workers and small businesses.
- Vanguard: Best for low-cost mutual funds and ETFs.
Why trust our investing experts
Our team of experts evaluate leading investing products and analyze a multitude of data points to help you find the best product for your situation. We use a data-driven methodology to determine each rating. Advertisers do not influence our editorial content. You can read more about our methodology below.
- 27 leading financial institutions reviewed.
- 4 levels of fact-checking.
- 70+ data points analyzed.
Fidelity
Charles Schwab
E*TRADE from Morgan Stanley
Merrill Edge
JPMorgan
Wells Fargo
PNC
Vanguard
Compare the best IRAs
| IRA | ACCOUNT MINIMUM | TYPES OF IRAS OFFERED | COMMISSION ON U.S. STOCKS AND ETFS |
|---|---|---|---|
Fidelity
| $0
| Traditional, Roth, SEP, SIMPLE
| $0
|
Charles Schwab
| $0
| Traditional, Roth, SEP, SIMPLE
| $0
|
Interactive Brokers
| $0
| Traditional, Roth, SEP, SIMPLE
| $0
|
E*TRADE from Morgan Stanley
| $0
| Traditional, Roth, SEP, SIMPLE
| $0
|
Merrill Edge
| $0
| Traditional, Roth, SEP, SIMPLE
| $0
|
JPMorgan
| $0
| Traditional, Roth, SEP, SIMPLE
| $0
|
Wells Fargo
| $0
| Traditional, Roth, SEP
| $0
|
PNC
| $0
| Traditional, Roth, SEP, SIMPLE
| $0
|
Vanguard
| $0
| Traditional, Roth, SEP, SIMPLE
| $0
|
Methodology
Our team reviewed and researched some of the largest online brokerages in the U.S. to rank the best in terms of their IRA offerings.
We sent a digital survey to each company reviewed. Our researchers verified the survey data and confirmed any missing data points by contacting each company directly and via online research.
From the 29 brokerages surveyed, we selected the top nine candidates that ranked the highest based on our scoring criteria.
Our methodology comprised the following categories: investment types, educational resources, retirement-specific educational resources, customer service, accessibility, security and customer rating, account and trading fees, company products, and insurance.
Each category was composed of numerous subcategories. For example, the “investment types” category had subcategories corresponding to whether ETFs, mutual funds, Treasurys, bonds, annuities and more were available.
Subcategories were scored based on the data we received and assigned weights, which were aggregated to form the overall scores and weights for each category.
From there, scores were tabulated on a 0.00 to 1.00 scale. The top score of 0.97 was curved up to a 5.00 rating as the highest possible one.
Why other IRAs didn’t make the cut
We used a ranking methodology that favored numerous investor-friendly metrics in our selection process. It prioritized aspects directly affecting your ability to grow your retirement savings efficiently and with the necessary support.
- Range of investments. This factor determines your ability to diversify your portfolio, which is essential for managing risk while seeking returns. Brokerages with a limited selection can restrict your ability to tailor your retirement strategy to your financial goals.
- Account and trading fees. High fees can significantly erode investment returns over time. IRAs with lower fees are typically more attractive. They allow you to retain more of your earnings, which can compound and grow until retirement.
- Customer service. This factor is especially important considering the self-directed nature of IRAs. You need reliable and accessible support to navigate account setup, understand investment options and resolve issues that arise.
- Robust educational resources. Educational resources empower you to understand the complexities of retirement planning and investment strategies. A lack of educational resources can leave you ill-equipped to manage your IRA effectively.
- IRA types. Different financial situations and retirement strategies benefit from different IRA types, such as traditional, Roth, SEP or SIMPLE. Brokerages that offer a variety of IRAs give you flexibility to choose the type that fits your needs.
Brokerages that fell short in any of these areas did not make the cut. That’s because they might be less beneficial to your ability to build and manage your retirement savings effectively.
In a market that’s competitive on all these fronts, these investor-friendly metrics can make or break an IRA provider’s desirability.
Final verdict
Our methodology for evaluating IRA providers identified Fidelity as the standout choice. It earned a top curved score of 5. Fidelity excelled in several highly weighted metrics, underscoring its position as the best overall IRA provider.
Fidelity offers a variety of IRA account types, catering to a broad spectrum of investors with different needs and strategies. Its extensive investment selection allows you to diversify your retirement portfolio. This is a critical aspect of sound financial planning.
Fidelity’s comprehensive suite of educational resources is a distinguishing feature. It provides a wealth of learning materials. These include courses, webinars and in-depth research. Additionally, Fidelity offers specialized retirement planning tools, such as calculators, that can help you gauge your retirement readiness and make informed decisions.
Fidelity’s dedicated customer service is particularly beneficial for newcomers to investing and retirement planning. It offers round-the-clock support via phone or virtual assistant. Live chat is available Monday through Friday from 8 a.m. to 10 p.m. ET and Saturday and Sunday from 9 a.m. to 4 p.m. ET.
Lastly, Fidelity’s fee structure is among the most competitive in the industry, with many options for fee-free investing. Its significant assets under management within its product lines allow it to leverage economies of scale. This benefits you in terms of costs and provides assurances due to Fidelity’s robust financial standing and reputation.
How to open an IRA
There are many factors to consider as you choose an IRA, including “the types of securities you are looking to invest in, how active you plan to be in your management of the account and whether you are looking for financial advice in retirement planning,” said Jim Penna, senior manager of retirement services and investment strategy at VectorVest Inc.
Here’s how to open an IRA:
- Decide which IRA type suits your financial goals, usually either traditional or Roth. The former offers tax-deferred savings. The latter provides tax-free growth.
- Select a financial institution, such as a bank, credit union, brokerage firm or robo-advisor, that offers IRA services. Consider the fees, investment choices, customer service and other factors.
- Complete an application with the institution of your choice. This can typically be done online. You must provide personal details, including your Social Security number, date of birth and employment information. You also have to designate beneficiaries.
- Fund your account. You can transfer money directly from a bank account, rolling over funds from another retirement plan or sending a check.
- Select your investments. Options vary based on where you open your IRA. They might include stocks, bonds, mutual funds and ETFs.
Remember that these are general steps. The specifics might vary depending on where you open your IRA.
After you open your IRA, consider making regular contributions to take advantage of compounding interest over time. Review and manage your account periodically and adjust your contributions or investments as needed. Also be aware of the annual contribution limits and the penalties for early withdrawals.
Types of IRAs
An IRA is an umbrella term that includes several types of retirement accounts. Each has unique characteristics, benefits and eligibility requirements. The two main types are traditional and Roth.
Traditional IRA
A traditional IRA might be attractive if you expect to be in a lower tax bracket upon retirement. It allows for tax-deferred growth. This means you don’t pay taxes on the earnings until you withdraw the funds in retirement.
Contributions to a traditional IRA might be tax-deductible depending on your income and whether you or your spouse can access a workplace retirement plan.
Roth IRA
A Roth IRA offers tax-free growth and tax-free withdrawals in retirement. Contributions to a Roth IRA are made with after-tax dollars. This means you pay taxes upfront.
There are no tax deductions for contributions. But because taxes are paid in advance, you benefit from tax-free growth. Roth IRAs are particularly beneficial if you anticipate being in a higher tax bracket in the future.
Roth IRAs have income limits that may affect your eligibility to contribute. They are updated annually, so it’s important to note the changes.
SEP IRA
A SEP IRA allows small-business owners and self-employed workers to contribute to a traditional IRA. It’s simpler than a pension plan and has higher contribution limits than a traditional or Roth IRA. But it doesn’t allow employee contributions. Only employers can contribute.
SIMPLE IRA
A SIMPLE IRA is also geared toward small businesses. Both employers and employees can contribute. It allows the business to set up a more straightforward and less costly retirement plan for employees. And there are fewer filing requirements for the employer.
Benefits of investing in an IRA
IRAs offer many benefits to encourage you to save and invest for your golden years.
As mentioned, traditional IRA contributions might be tax-deductible, providing upfront savings. This depends on your income and whether you or your spouse can access a workplace retirement plan. Your earnings grow tax-deferred.
Another benefit comes in retirement. You might be in a lower tax bracket when you start withdrawing from your traditional IRA. This means the money you withdraw could be taxed at a lower rate than it would have been during your employment.
Roth IRA contributions, on the other hand, aren’t tax-deductible. But earnings grow tax-free. Withdrawals in retirement are also tax-free.
Because IRAs offer tax-deferred or tax-free growth, any capital gains, dividends and interest income your investments earn within the IRA do not incur taxes year over year. This maximizes their growth potential.
“Your earnings in an IRA grow without being reduced by paying taxes each year,” Penna said. “That leaves you more buying power, and that can greatly enhance your returns over time.”
Earnings in a traditional IRA are taxed upon withdrawal, typically in retirement. There are no taxes on qualified distributions from a Roth IRA. This tax-deferred or tax-free growth can significantly impact the value of your retirement savings. It allows your investments to compound more efficiently over time without the drag of annual taxes.
By protecting your earnings from immediate taxation, IRAs can help your retirement savings grow more quickly than they would in a taxable account.
Our partners
Datalign Advisory
Connect
Match with a financial advisor from a network of vetted fiduciaries.
Get started
Complete the questionnaire and match with an advisor for a free, no-obligation call.
Wealthramp
Find your match
Connect with fee-only advisors who fit your priorities
Build your wealth
Review your vetted advisor matches and set up a free consultation
J.P. Morgan Personal Advisors
Create a personalized financial plan
Get matched to expert-built portfolios, and receive ongoing advice and annual check-ins to ensure your plan is on track.
INVESTMENT AND INSURANCE PRODUCTS ARE: NOT A DEPOSIT • NOT FDIC INSURED • NO BANK GUARANTEE • MAY LOSE VALUE
Frequently asked questions (FAQs)
Your investment objectives and time horizon largely influence when to open an IRA. But since an IRA is designed for retirement savings, opening one sooner rather than later is generally advisable.
Starting early can maximize the benefits of compounding interest, where the earnings on your investments generate their own earnings. Over time, it can significantly increase the growth of your retirement fund, especially if you contribute during your peak earning years.
Moreover, contributing to an IRA at a younger age can instill a habit of saving and investing for the future. The flexibility of an IRA also means that as your career progresses and your income increases, you can adjust your contributions accordingly.
Determining how much you should contribute to an IRA depends on your financial situation.
Before deciding on the amount to contribute, consider whether you have sufficient savings or an emergency fund in place. Once you have your financial safety net secured, contributing to an IRA can be a wise decision.
But be mindful of the contribution limits. For 2024, you can contribute up to $7,000 to all of your traditional and Roth IRAs. If you’re 50 or older, you’re allowed a higher contribution limit of $8,000 to account for catch-up contributions.
Remember that your contributions cannot exceed your taxable compensation for the year. If your income is less than the contribution limit, then your maximum contribution amount is your total taxable income for the year.
Yes, losing money in an IRA is possible because it holds various investments. The risk of principal loss in your IRA depends on the types of investments you choose to hold within it.
For instance, if your IRA contains stocks or equity funds, your account value can fluctuate with the stock market. These types of investments can incur unrealized losses due to their volatile nature, particularly in the short term.
On the other hand, an IRA that holds more conservative investments, such as certificates of deposit, offers safety of principal. CDs are typically insured up to certain limits, meaning they offer a fixed rate of return and protection of your initial investment up to the covered limits if the depository institution fails.
Blueprint is an independent publisher and comparison service, not an investment advisor. The information provided is for educational purposes only and we encourage you to seek personalized advice from qualified professionals regarding specific financial decisions. Past performance is not indicative of future results.
Blueprint has an advertiser disclosure policy. The opinions, analyses, reviews or recommendations expressed in this article are those of the Blueprint editorial staff alone. Blueprint adheres to strict editorial integrity standards. The information is accurate as of the publish date, but always check the provider’s website for the most current information.
