A:

You may open Roth IRAs at most financial institutions, such as your local bank, your credit union, or brokerage firm. You can even establish an IRA online. The process is as easy as completing a one-page document. Most financial institutions may also require that you complete a new account or customer application in addition to the Roth IRA adoption agreement.

Before you choose a financial institution, you want to compare features and benefits. For instance, one institution may charge $30 annually for administrative fees, while another may charge $50. Although this amount may seem small, it can be significant when compared to your account balance. For instance, if you decide to contribute $1,000 to your Roth IRA for the year and the annual fee is $50, this would be 5% of your balance.

You should also consider accessibility of funds. It may be easier to access your assets at your local bank than at an online financial institution. On the other hand, online financial institutions charge lower fees in most instances.

Another important thing to consider is the type of investment you would prefer. For instance, would you like to invest in a certificate of deposit, money market fund or mutual fund? Financial institutions should be able to explain the options they have available, including the features and any applicable fees.

This question was answered by Denise Appleby
(
Contact Denise)

RELATED FAQS
  1. Where can I open a Roth IRA?

    Roth IRA accounts are opened through a Roth IRA provider. These providers are banks, insurance companies, brokerage houses ... Read Full Answer >>
  2. What is a derivative?

    A derivative is a contract between two or more parties whose value is based on an agreed-upon underlying financial asset, ... Read Full Answer >>
  3. What is after-hours trading? Am I able to trade at this time?

    After-hours trading (AHT) refers to the buying and selling of securities on major exchanges outside of specified regular ... Read Full Answer >>
  4. Am I losing the right to collect spousal Social Security benefits before I collect ...

    The short answer is yes, if you haven't reached age 62 by December 31, 2015. The Bipartisan Budget Act of 2015 disrupted ... Read Full Answer >>
  5. Where else can I save for retirement after I max out my Roth IRA?

    With uncertainty about the sustainability of Social Security benefits for future retirees, a lot of responsibility for saving ... Read Full Answer >>
  6. When can catch-up contributions start?

    Most qualified retirement plans such as 401(k), 403(b) and SIMPLE 401(k) plans, as well as individual retirement accounts ... Read Full Answer >>
Related Articles
  1. Options & Futures

    What Does Quadruple Witching Mean?

    In a financial context, quadruple witching refers to the day on which contracts for stock index futures, index options, and single stock futures expire.
  2. Retirement

    How Much Should You Have In Your 401(k) To Retire?

    Determining how much money should be in your 401(k) when you retire depends on several variables, many of which are uncertain.
  3. Options & Futures

    4 Equity Derivatives And How They Work

    Equity derivatives offer retail investors opportunities to benefit from an underlying security without owning the security itself.
  4. Investing

    How To Make Sure Your Healthcare Costs Do Not Ruin Your Retirement

    The best proactive plan of action for a stable retirement is to understand medical costs, plan ahead, invest properly, and consider supplemental insurance.
  5. Investing

    3 Small Steps to Maximize Your Investing Goals

    Instead of starting the New Year with ambitious resolutions, why not taking smaller manageable steps that can have a real impact.
  6. Investing

    7 Creative Ways to Save for an Early Retirement

    Take note of these out of the box steps you can take towards securing yourself an earlier, more comfortable retirement.
  7. Your Clients

    Tips for Making Your Nest Egg Last Longer

    If you’re trying to figure out how to make your hard-earned nest egg last, there’s one piece of advice that stands above the rest.
  8. Personal Wealth & Private Banking

    What People Hate About Financial Advisors

    Advisors need to make a living too, but doing so by cutting corners at a client's expense isn't right. Here are the top complaints against advisors.
  9. Retirement

    Retirement Plan Tax Prep Checklist

    Here's a list of items you need to have in order by tax time, including paying attention to those pesky required minimum distributions.
  10. Retirement

    When to Fire Your Advisor and Go Robo-Advisor

    Human financial advisor or robo-advisor: Which suits your needs best? Here are some general tips to help guide you to the right professional.
RELATED TERMS
  1. Warrant

    A derivative that confers the right, but not the obligation, ...
  2. Bull Call Spread

    An options strategy that involves purchasing call options at ...
  3. Board Of Directors - B Of D

    A group of individuals that are elected as, or elected to act ...
  4. Sequence Risk

    The risk of receiving lower or negative returns early in a period ...
  5. Backdoor Roth IRA

    A method that taxpayers can use to place retirement savings in ...
  6. Crude Oil

    Crude oil is a naturally occurring, unrefined petroleum product ...
Hot Definitions
  1. Flight To Quality

    The action of investors moving their capital away from riskier investments to the safest possible investment vehicles. This ...
  2. Discouraged Worker

    A person who is eligible for employment and is able to work, but is currently unemployed and has not attempted to find employment ...
  3. Ponzimonium

    After Bernard Madoff's $65 billion Ponzi scheme was revealed, many new (smaller-scale) Ponzi schemers became exposed. Ponzimonium ...
  4. Quarterly Earnings Report

    A quarterly filing made by public companies to report their performance. Included in earnings reports are items such as net ...
  5. Dark Pool Liquidity

    The trading volume created by institutional orders that are unavailable to the public. The bulk of dark pool liquidity is ...
Trading Center