Firstrade IRA Fees For 2020
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| Investments | Commissions |
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| Stocks and ETFs | $0 |
| Stocks, ETFs, and mutual funds broker assisted | $19.95 |
| Options | $0 |
| Mutual funds | $0 |
| Treasury Bills, Notes, Municipal and Agency Bonds, Zeros & Strips | net yield basis |
| CDs | $30 for primary market CDs, net yield basis for secondary market CDs |
| Investments | stocks, options, mutual funds, bonds, CDs, ETFs |
| Firstrade minimum deposit to open account | $0 |
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Firstrade IRA Types
Firstrade is a popular broker choice due in large part to their commission-free equity trades and large variety of security types to invest in. They also offer all of the standard IRA accounts, including a Traditional and Roth IRA (as well as Rollover IRAs). Even though trading in these accounts is mostly commission-free, there are still some fees for certain things that you should be aware of, and we’ll cover these in this article.
First, let’s start with the two IRA types Firstrade lets you choose from – Traditional and Roth. A Traditional IRA is where you make contributions with pre-tax income, and let it compound in the market until you’re ready to retire. Once you withdraw money from a Traditional IRA you will have to pay taxes on the full amount (contributions and capital gains). This is a good choice for anyone who expects to be in a lower tax bracket later in life and during retirement.
For anyone who expects to be in a higher tax bracket later in life, Firstrade’s Roth IRA might be a better choice. The Roth IRA differs from the Traditional IRA in that it is funded with income you’ve already been taxed on, and when you go to withdraw funds in retirement these redemptions will be entirely tax-free (including your capital gains).
Firstrade IRA Account Fees
Firstrade doesn’t charge you any fees to open an IRA, nor will they charge you any account maintenance fees.
IRA Trading Costs
As we mentioned, Firstrade doesn’t charge any commissions for trading stocks, ETFs, mutual funds, options, or bonds in your IRA account, but there are a couple scenarios that could warrant a fee. The first is trading primary market CDs, for which Firstrade will charge you a flat $30/trade. Second, although trading bonds is commission-free, the bid/ask spread that Firstrade quotes you on these is on a net yield basis, meaning they act as a market maker and will build in a markup/down to the price they quote you to compensate them for facilitating the trade. Third, exercising an options position in your IRA account will incur a $14.95 exercise fee.
Mutual Fund Fees
Lastly, although buying and selling mutual funds is commission-free at Firstrade you must meet their minimum investment amounts when buying funds, which is $500 for the initial buy and then $100 for any subsequent purchases. If you aren’t able to meet these minimums, Firstrade will charge you a $19.95 transaction fee. Additionally, investors should plan to hold any mutual funds in their IRA for at least 90 days, because Firstrade will charge you a $19.95 short-term redemption fee for selling any mutual funds that have been held for fewer than 90 days.
Foreign Security Fees
If your IRA includes ADRs (American Depository Receipts), Firstrade will pass on to you any custody fees they are charged, which are generally between $0.01 and $0.05 per share. Transferring a foreign security into or out of your Firstrade IRA will cost you a one-time transfer fee of $75.
IRA Transfer Fees
Similarly, if you ever want to transfer your entire Firstrade IRA to another broker, Firstrade will charge you a one-time fee of $75. Partial IRA account transfers are charged a $55 fee.
Wire Transfer Fees
If you plan to wire money out of your Firstrade IRA during retirement, Firstrade charges a fee between $30 and $50 depending on if your money is being transferred domestically or internationally. Withdrawals via electronic transfer (ACH Transfer) are always free.
Paper Statements
If you elect to receive your monthly IRA account or year-end tax statements in the mail (instead of online) Firstrade will charge you a small processing fee between $3 and $10.
Firstrade IRA Fees Summary
Firstrade’s IRAs are a good choice, partly because of the lack of fees. Not paying commissions on most trades will help you preserve more of your capital, and for the few fees that Firstrade does charge in certain conditions, these are generally easily avoidable (i.e. choosing electronic statements over paper).
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