Etrade IRA Review – The Honest Truth

Your retirement plan demands both security and growth. Could ETrade’s IRA be right for holding your golden eggs? Before opening an Etrade IRA, review what you need in a broker and if Etrade has the right features for your retirement plan.

Types of IRA Accounts

Etrade IRA Reviewed

Etrade IRAs offer many benefits that traditional brokerage firms do not. First, Etrade IRAs have some of the lowest commissions per stock and mutual fund trade at just $9.99 each, and the amount drops to $7.99 per trade if you complete more than 150 trades per quarter. If you’re looking for trade ideas, read my Daily Market Advantage review.

For most investors, 150 trades per quarter is out of their league, but wealthier investors that make weekly adjustments or additions to their portfolio may easily reach this threshold, especially with the use of exchange-traded funds. Of course, wealthier investors are less likely to care about a few dollars here and there, but the cents quickly add up in the end. The difference between 150 trades for $9.99 and 151 trades for $7.99 is $291, which is no small amount when compounded over the long term.

Fee Schedule for Etrade IRA Review

Etrade IRAs do not come with an annual fee. In contrast, other brick and mortar companies charge as much as $200 per year just to open an account. The savings is a dramatic benefit to investors who are just starting to begin building their nest egg and need to avoid costly fees. Of course, for established investors, $200 per year is very little on an aged account, but it does make a difference.

Investors may also see a big gain in the Etrade IRA review sheet, which posts zero commissions for trading US Treasury bonds. For fixed income investors, or those nearing retirement, this is a hugely important benefit, though you’ll need as much as $10,000 just to buy one bond.

One drawback to ETrade IRAs is the $25 fee charged for IRA premature distributions.

Etrade IRA Reviewed: Mutual Funds

Mutual funds are very popular with mutual fund investors, and Etrade does very well in this category. The company boasts access to over 1,000 no-load mutual funds (those without upfront fees) and offers $9.99 trades for each mutual fund investment. Mutual fund trades also come into consideration for the bulk rate discount of $7.99 per trade for those who complete more than 50 trades per month.

Etrade IRA Reviews: Customer Service

In surveying individual experiences with ETrade, most of the complaints revolve around the brokerage’s slow customer service. By the same token, just as many clients extolled the broker’s excellent service. Thus, if hands-on customer service is highly important to you, it may behoove you to initially call ETrade to determine for yourself if their services will meet your needs.

Of course, before opening an Etrade IRA, review what you need in a brokerage firm and see if Etrade fits your criteria. In addition, be sure to check on any promotional offers or benefits to switching to Etrade from another provider. Often is the case that brokerage firms give special deals to clients who move from their competition to their own investment solutions.