Charles Schwab rating

The Best Traditional IRA Account (2024)

What Makes Schwab The Best Broker for a Traditional IRA

There are several reasons why we think Charles Schwab is a good place to open a Traditional IRA. Besides its long history in the securities industry and its trustworthy reputation, here are some perks that make the brokerage firm especially enticing for a Traditional IRA:

No IRA Fees or Minimums. Schwab charges no ongoing IRA fees. There are no annual, maintenance, low-balance, or inactivity charges. There is no fee to open, maintain, or close an IRA. An IRA can be opened and maintained with any balance, including a zero balance. It is still common nowadays to find investment firms with some type of IRA fee, but not at Schwab.

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Traditional 401k Availability. Besides the Traditional IRA, Schwab offers the self-employed Traditional 401k with rollover service to a linked IRA. The accounts complement each other and can be accessed with a single login. It’s not too difficult to perform the rollover; a simple pdf form is all that is required.

SEP and SIMPLE IRAs. For small businesses, Schwab also has SEP and SIMPLE accounts. These are taxed in the same way as the Traditional IRA (tax deductions on the front end with taxation on withdrawals). Like the 401k, they can make a nice complement to a personal Traditional IRA with rollovers into the Traditional account. Unlike the 401k, a SEP or SIMPLE IRA can be opened with a simple online form.

Brokerage and Advisory Options. A Traditional IRA can be opened in either self-directed or investment-advisory mode. The latter program is available in many formats, including robo, human, and hybrid. It’s possible to switch a Traditional IRA from one form to another. Although many investment firms today have rolled out automated-investing programs, fewer and fewer have traditional human investment advisors. Schwab still has them, and they can perform a variety of services that retirees may need help with.

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Branch Locations. Many of these investment advisors can be found at one of Schwab’s 300+ physical locations. While other brokerage firms have closed their brick-and-mortar offices, Schwab still maintains its network. These are always good places to find service on a variety of issues. They can help to open an account or accept any documents that need to be added to an account. A branch office can also help to make a withdrawal from a Traditional IRA.

Retirement Planning. When it comes time to actually make retirement decisions with the Traditional IRA, Schwab’s experienced financial planners are available to help in a variety of capacities. They can create a written retirement plan that can really help chart a course to retirement using not only the Traditional IRA but other retirement products available at Schwab.

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Other Retirement Products. These other investment vehicles include annuities, Roth accounts, small-business products, education and custodial accounts, cash solutions for retirees, trusts, home loans, credit cards, and life insurance. It’s really easy to open any of these vehicles at Schwab and access them with the same login. Although other investment firms may have the Traditional IRA, they usually don’t have all of the other complementary resources that Schwab has.

Many Available Securities. Self-directed IRAs have a wide range of asset classes to choose from. Possibilities include ETFs, mutual funds, closed-end funds, bonds and other fixed-income securities, options, and stocks.

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Retirement Securities. Schwab’s website has a user-friendly tool to create bond and CD ladders, which are common investment vehicles for retirees. Also on tap are lifecycle mutual funds, which are designed for retirement saving and planning.

Investment Advice. Traditional IRA customers who don’t have a clue where to begin can reach out to Schwab’s large team of financial advisors for assistance. Besides the branch network already mentioned, there are many other support channels, including phone and email. In addition to advice on what to actually invest in, Schwab’s financial experts can provide advice on annuities and the other investment vehicles already mentioned. In some cases, an advisory relationship may be required to receive guidance on certain products.

Good Software. IRA customers at Schwab can use the broker’s website and mobile app to manage their accounts, make contributions, place trades, and perform a variety of other functions. A simple ACH transfer is all that is required on either the website or mobile app to make a tax-deductible contribution. The online deposit form keeps track of an IRA’s total contributions for the year, so there’s less of a chance of overcontributing.


Online Retirement Tools. Both advisory and brokerage customers at Schwab will find a treasure trove of IRA resources that are hard to find at other investment firms. These materials are mostly on the website, although some are on the mobile app, too. During our investigation, we found articles and videos on a wide variety of retirement topics, from reducing taxes to handling Required Minimum Distributions (RMDs).

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