Robo-advisors are a great choice for those who want to take control of their investment decisions. Look for one with a low management fee, usually 0.40% or less, and services that meet your needs. Automatic rebalancing and portfolio allocation are usually standard, but other features, such as access to human financial advisors, may vary by provider. Once you've chosen the right account for you, you'll need to decide how to fund it.
Typically, you can do this by transferring funds from a bank account, transferring existing IRA assets from another company to your new account, or transferring a 401 (k) plan. If you have a 401 (k) from a previous job, you can move those funds to your new employer's retirement plan or to an IRA using a 401 (k) transfer. For many people, transitioning to an IRA is the best option, since IRAs tend to have a wider range of investment options and lower fees than many 401 (k)s. Moving your funds from a 401 (k) from a previous employer to an IRA is a straightforward process, and most 401 (k) and IRA providers are well-equipped to handle it.
You can learn more about the process in our 401 (k) rollover guide. A traditional IRA can be an excellent way to save for retirement, as potential earnings increase tax-deferred and your contributions can be tax-deductible.1 With Fidelity, you have access to a wide range of investment options, including options for us to manage your money for you. You'll get exceptional service, as well as planning and guidance assistance. You can take penalty-free withdrawals for certain expenses, such as buying your first home, birth or adoption costs, or college expenses.2 As long as you keep working, you never have to stop contributing to a traditional IRA and you can contribute to an IRA in addition to your 401 (k).
You can use our IRA Contribution Calculator to find out how much you can contribute. Once you've set up your account, what's next? Keep in mind that investing involves risks. The value of your investment fluctuates over time and you can make or lose money. Fidelity does not provide legal or tax advice. The information contained herein is general in nature and should not be considered legal or tax advice.
Consult a lawyer or tax professional regarding your specific situation. Fidelity Brokerage Services LLC, NYSE Member, SIPC, 900 Salem Street, Smithfield, RI 02917 I will choose and manage my investments. I would like Fidelity to choose and manage my investments. There is generally no cost associated with opening a Roth IRA; however, each provider may have different requirements. You may need to make a minimum deposit when opening a Roth IRA; be sure to check with your provider before opening an account.
Step 3Quickly open your IRA online & Easily name your IRA beneficiaries. We will send you instructions once your IRA is open. When selecting an IRA for retirement savings, you'll likely decide between a traditional IRA or a Roth IRA. Choosing the right type of retirement account is important for ensuring that your savings are maximized and that you're taking advantage of all the benefits available to you. A traditional IRA allows for tax-deferred growth on investments and potential tax deductions on contributions; however, withdrawals are taxed as ordinary income when taken in retirement. A Roth IRA offers no upfront tax deductions on contributions but allows for tax-free withdrawals in retirement. When deciding which type of account is best for you, consider factors such as your current income level and tax bracket; whether or not you expect your income level or tax bracket to change in the future; whether or not you plan on making early withdrawals; and whether or not you want the flexibility of being able to withdraw contributions without penalty. No matter which type of account you choose, it's important that you start saving for retirement as soon as possible so that your money has time to grow over time.