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Im still new to learning about IRA options, mutual funds, etc. I currently have Ally bank and was thinking of opening an IRA with them (ROTH to be exact). But it seems like they only offer the type of IRA that you just deposit and earn like 1% interest. I don't see anything about being able to invest part of it in the market.
What would i do in this case. I want to have an IRA that i have the option to invest part of it in market..and part of it NOT. My company doesn't offer 401k so I'm pretty much on my own. It took me a while to try to understand all of this and now i'm more confused. Is there a bank that will offer what i'm looking for? Or do i have to bank directly with one of those mutual fund/broker companies?
again..i'm still new to all this lingo so please keep the responses as elementary as you can lol
I would suggest you open a Roth at one of the discount brokerage (Schwab, Fidelity Etc). You can then invest your Roth in stocks, bonds, ETF's Mutual funds, CD.
You can move you Roth from one place to another (you let them do it fiduciary to fiduciary) or there are tax implementation to it.
Someplace like Etrade or Ameritrade will let you open a Roth IRA and invest in just about anything you want, including Fidelity and Vanguard mutual funds.
Ally is a great bank for your daily/emergence accounts since they compound daily & offer very competitive dividends.
But to start an IRA/Roth IRA go to one of the investment banks suggested above. After many years I recently moved the bulk of my accounts to Vanguard because of their extremely low costs, especially their Admiral funds.
A 1% difference in fees may not seem like much but if you are in your 20s/30s you may have money in those accounts for 50-70 years & that turns into a ton of lost money over time.
for those of you who suggested brokerage companies...when you sign up for an IRA there...do you have to put ALL OF YOUR MONEY in the market? if not..what happens to the part of your money that's not invested in the market? do they offer a rate for that like they would at a bank's IRA plan? I think Ally bank is a little over 1% right now.
I'm trying to start out with atleast part of my money NOT in the market. but i don't want it to sit there with a 0% rate either. could someone explain this to me?
Too broad a statement. Many bank-based investment advisors are affiliated with independent broker/dealers and can offer a great variety of investments. The investment guy at my hometown bank is a Raymond James advisor.
A broker will deposit your cash contributions into a sweep account. The sweep account usually does pay interest, but you can expect it to be very low, like .01%.
Once the money is in the sweep account, you decide how it will be invested. Stocks, bonds, money market funds, etfs, whatever.
If you want to permanently keep some of your IRA in cash, open two IRAs. One at Ally for your cash, one with a broker for your investments.
Originally Posted by Gandalara Stay away from banks for investing.
Quote:
Originally Posted by duster1979
Too broad a statement. Many bank-based investment advisors are affiliated with independent broker/dealers and can offer a great variety of investments. The investment guy at my hometown bank is a Raymond James advisor.
My bad.
I was thinking more in the lines of B of A, Chase, etc etc.
In my experience, their fees are in up in orbit (And they don't offer what I want, LOL)
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