Roth IRA Accounts: Establish And Choose The Right Provider

2007-03-08 10:33:40

( Computers )



When you establish your Roth IRA accounts, they must be clearly designated as such and kept separate from your regular IRAs. Contributions to Roth IRA accounts must be maintained as a separate trust, custodial account, or annuity by providers whom the IRS has accredited to act as trustees or custodians. These providers include banks, mutual fund companies, brokerage firms and insurance companies.

Banks

Commercial banks, savings and loans, credit unions and trust companies charge minimal fees for your Roth IRA accounts. Banks usually accept small Roth IRA accounts. They are good places to open an account if you are just starting out and don't have enough money for large investments. But banks don't offer as many investment options as other providers.

Mutual Fund Companies

These companies accept Roth IRA accounts but require a minimum amount. Mutual fund companies allow you to choose from their wide array of investments. You can invest portions of your Roth IRA accounts in different types of mutual funds.

Brokerage Firms

If you are investment savvy, you may choose to open your Roth IRA accounts (also called self directed IRAs) with stock brokerage companies. These firms give you the option to select your own investments such as stocks, bonds, mutual funds and many others.

Insurance Companies

If you like any investment products of an insurance company or you would want to have your Roth IRA accounts maintained as annuities, you may also want to consider an insurance company as your provider.

It is quite easy to establish Roth IRA accounts since some providers allow you to set up an account online. But before you do so, you should inquire about the fees involved. You can then use any tax accounting software to track the growth of your Roth IRA accounts and input the fees that will be charged by your designated trustee.


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