E*Trade IRA Overview
In addition to commission-free funds and a user-friendly website, E*Trade also offers several different Individual Retirement Accounts (IRAs). With professional portfolio management and good trading technology, an E*Trade IRA is worth considering.
E*Trade IRA Account Types
E*Trade offers its clients a selection of IRAs. Investors can choose Traditional, Roth, Rollover, OneStop Rollover, Minor IRA in both Roth and Traditional versions, Beneficiary, Complete, SEP, and SIMPLE versions.
Traditional and Roth IRAs were created for individual investors. The Rollover is an IRA whose funds have been transferred from a previous employer's plan, such as a 403(b) plan. The OneStop Rollover IRA is converted from a 401(k) plan. The assets are professionally managed by E*Trade Capital Management for an advisory fee. There are no trading commissions charged to the account. The minimum initial rollover amount is $25,000.
The Minor Roth is for parents who want to start saving for their children's retirement. The Beneficiary IRA is a retirement vehicle that has been inherited. Investors aged 59½ or over can open a Complete IRA. This account comes in both Roth and Traditional versions. It includes unlimited check writing, online bill pay, and unlimited free ATM withdrawals nationwide. Finally, the SEP and SIMPLE retirement accounts are designed for small businesses, partnerships, sole proprietorships, non-profits, corporate employers, and self-employed persons.
E*Trade IRA Fees and Minimums
E*Trade IRAs have no account minimums, no inactivity fees, and no annual fees. The broker has a $500 minimum to open a standard brokerage account, but has no minimum for an IRA. There is a $25 fee for early withdrawals (those before age 59½), including withdrawals the IRS allows with no penalty. There is another $25 fee if excess contributions have to be withdrawn from an account. There is also a $25 charge for recharacterizations, such as when a Roth IRA conversion is changed back to a Traditional.
After the retirement account is open, E*Trade’s regular commission schedule applies to the account. This
includes a $0 commission for stock and ETF transactions. Using a living, breathing broker to place a trade over the phone costs a very reasonable $25.
Etrade Mutual Funds
Traders who don't want to pay the above commissions should check out the broker's selection of
NTF mutual funds. E*Trade customers can buy and sell more than 10,000 mutual funds. Of these,
over 4,200 have no transaction fee and no load. Transaction-fee funds cost $19.99. This commission applies to purchases, sales, and exchanges.
IRA Calculators
E*Trade has some calculators that will benefit retirement savers. As an example, a conversion calculator helps investors determine if transferring assets from an existing employer-sponsored retirement plan to a new plan would make financial sense. After inputting various information, such as age and current plan, the calculator gives a recommendation.
The broker has another calculator that shows the financial consequences of converting from a Traditional to a Roth IRA. After typing in some basic information, such as age at retirement and current tax rate, the calculator shows what it will cost to make the switch.
An inheritance calculator leads users step-by-step to evaluate what should be done with an IRA from a deceased person's estate. Users input certain information into the tool, such as age at time of death and type of retirement plan. The calculator then makes a suggestion regarding the inherited account.
Another calculator determines the minimum required distribution that an investor needs to withdraw from an IRA. The tool considers such information as estimated annual return, and age of account holder, then displays the required amount that must be removed from the account and the date that withdrawals must begin.
IRA Videos and Learning Materials
E*Trade has a good selection of informational products on its website that will help investors who are trying to save for retirement. There are videos, articles, and web seminars. These educational materials discuss a variety of topics, such as planning for retirement, choosing a beneficiary, and IRA conversions. The materials are free of charge after logging into the website.
Comparison
The broker's $0 minimum initial deposit requirement is better than Charles Schwab's $1,000 minimum. E*Trade also provides more
commission-free funds compared to several other brokerage firms, such as Ally Invest and Merrill Edge. E*Trade also has more IRAs to
choose from. Many brokers don't offer the Complete IRA, for example.
On the flip side, Webull has $0 commissions on all investment products, including
stocks, ETFs, cryptocurrencies, and options.
E*Trade IRA Review Summary
E*Trade has some good retirement resources and plenty of IRAs to choose from. With no fees for their accounts and 24/7 customer service, an E*Trade
IRA is a decent value. Anyone looking for the best pricing in their IRA will find that in other brokers such as
TD Ameritrade
or M1 Finance.
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