Best IRA Account For Beginners

Best IRA For Beginners Overview

Scottrade frequently advertises its low $6.95 equity trading commission. But the broker also has a good selection of Individual Retirement Accounts (IRA's) for beginners. Let's take a look at what exactly this large brokerage house offers for new investors.

Cost of Trading

The $6.95 security (stocks and ETFs) trading fee is lower than most of Scottrade's competitors, such as Vanguard ($7-$20) or Wellstrade ($8.95). Investors who trade frequently or even moderately over a year or more can certainly expect to save a respectable sum in trading fees.

Scottrade does offer margin accounts for clients who wish to borrow for some of their trades. Currently, margin debits of less than $10,000 cost 7.75%. In comparison, Fidelity currently charges 8.75% for the same amount borrowed; and Schwab is at 8.5%

Trading Tools

For traders looking to trade equities, Scottrade’s web site is simple in design and easy to use. A step up from the web site is Scottrader Streaming Quotes, a Java-based system launched from the web site. It offers charting, order entry, market news, among other services. The platform is customizable and simple to learn. An equity search function displays the top ten stocks for the day sorted by criteria such as volume and percent gain.

The most advanced trading platform is ScottradeELITE. The platform is available to customers who have a combined balance of $25,000 in Scottrade financial accounts, or who place 9 equity or options trades in a 3 month period.

Mobile Trading

Scottrade has applications for iPhone, iPad, Android, and mobile web. The interface is intuitive and user friendly. Users can place an order, read market news, search for stocks and options, and look over account and position data.

IRA Learning Materials

Scottrade has a few articles on its site that discuss retirement issues. These cover such topics as SIMPLE IRA accounts, the stages of retirement planning, investment strategies during retirement, and contributions.

The broker has a list of Frequently Asked Questions for IRA's. These cover questions such as opening multiple IRA's, the differences between Roth and Traditional, rollover policies, and the advantages of SEP and SIMPLE.

Best IRA Account For Beginners

Best IRA For Beginners Comparison

A $2,500 minimum deposit requirement for a Scottrade IRA is more than Schwab's $1,000 minimum. Unlike some other brokers, such as Merrill Edge, Scottrade does not charge an IRA closeout fee. Scottrade also offers more NTF mutual funds than many other brokers. Scottrade's approximately 3,000 NTF funds are more than Fidelity's list (around 1,800) and much more than Merrill Edge's offering (about 800). On the flip side, Scottrade has far fewer educational resources than Fidelity, Charles Schwab, and TD Ameritrade.

Scottrade IRA Promotion

Investors who transfer assets of at least $10,000 from an existing IRA to Scottrade will receive 50 free trades. A transfer of at least $25,000 will also garner a $100 cash bonus. Promotion link: Open IRA Account: Start Saving With Scottrade Today.

Scottrade will also refund transfer fees up to $100 charged by another broker for customers who incur fees when transferring to Scottrade. Clients must apply for the rebate by completing an Account Transfer Reimbursement Request form.

Customer Service

Customers can contact the broker through an online chat system, phone, fax, or e-mail. The phone service is available from 5:00 AM to 12:00 PM (CST), Monday through Friday, and 8:00 AM to 6:00 PM (CST) on the weekend.

The firm is known for offering many brick-and-mortar branches across the country. It currently has over 500 nationwide, more than Charles Schwab, E*trade, and Fidelity Investments.

Cash Management Features

Scottrade has an FDIC-insured banking service that offers both checking and savings accounts. The checking account comes with no setup fee, no minimum balance, and no monthly account fee. It has free checks and a debit MasterCard. Dividends from income-paying stocks can be transferred to a Scottrade checking or savings account instead of to the FRIP pool.

Transition To TD Ameritrade

June 22, 2017 update:

TD Ameritrade, which acquired Scottrade last year, announced that it plans to fully integrate Scottrade this year. For this reason it makes more sense to open an account with TD Ameritrade directly especially considering that their promotion offer basically allows creating an investment portfolio without paying any commissions.


Scottrade offers unique advantages at low cost. Its one of a kind dividend reinvestment program, easy to use website and trading tools, largest network of local branches, and top rated customer service make it the Best IRA For Beginners in 2017.

Article was updated on 3/30/2017.

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