What IRA to choose?

January 31, 2011 3:08 PM

What's the best Roth IRA to invest in? Does Fidelity waive the $2500 deposit if you sign up for monthly withdrawals?

I'm researching IRA's, I don't have a huge lump sum to start investing however I can easily contribute a few hundred dollars a month form my paycheck. I just can't figure out if Fidelity's rules will waive the initial 2500 dollar deposit if I sign up for monthly payments.

Also just wondering if anyone recommends a different company?

I do have money saved however it's for my Emergency Fund so obviously I don't want to drop it on an IRA deposit. Given that should I simply save up the $2500 before even thinking about starting an IRA?

Also, I do ING checking/savings and I know they have IRA plans but I heard that the options are limited and not worth it, can someone confirm this or state their case otherwise?

posted by modoriculous to Work & Money (7 answers total)

I'm pretty sure Vanguard has funds with a $1000 minimum, and they will wave that with automatic deposits.
posted by COD at 3:18 PM on January 31, 2011

I use Charles Schwab for an IRA and brokerage account and am quite happy with it. From their site, it looks like you can open a Roth with $0 if you sign up for monthly deposits of at least $100.
posted by rube goldberg at 3:50 PM on January 31, 2011

If you set up automatic withdrawals of at least $200 a month Fidelity waives the $2500 minimum to start a Roth IRA (see footnote 2 at link). That's how I did it. I had to call them to set it up as there wasn't a way to do it online when I started my Roth with them in late 2007, but there may be a way to do it online now.
posted by grapesaresour at 3:51 PM on January 31, 2011

I have a Roth Ira with Sharebuilder (ING) and I'm a fan. They offer a bunch of no-fee mutual funds and have $4 stock trades. Only downside is that to sell stocks you need to pay the full price ($9.95) per trade. But if you're not a heavy buyer/seller they're not a bad deal.

I also have a rollover IRA with Schwab too and they're great and have no fees. Looks like they do have $1000 minimum to open but its waived if you open a checking account at the same time.
posted by jourman2 at 4:06 PM on January 31, 2011

I've had a good experience with T. Rowe Price for my Roth IRA. I think their required deposit to open one is $2500 as well, but they waive that as long as you sign up for monthly contributions from a linked bank account of at least $50 (which is what I did).
posted by 1901gunner at 4:55 PM on January 31, 2011

Given the number of advantages a Roth IRA confers after five years, you should probably start now, even if you can't put in a large initial deposit. I know when I was opening my Roth IRA with Fidelity they were pushing the 200 dollar direct deposit method. Your investment options are restricted though, until you've built up enough capital to bother with.
posted by pwnguin at 5:07 PM on January 31, 2011

TradeKing doesn't have any minimums or annual fees for IRA accounts. Also they charge $4.95 per trade which is one of the lowest among discount brokers. That is more if you want to invest in ETFs and actually make trades. Otherwise I would suggest saving up the minimum for Vanguard and just putting it into a fund.
posted by burnmp3s at 7:15 PM on January 31, 2011