Have questions about our IRA accounts?

Here are a few quick answers to some of the most commonly asked questions. If you have additional questions, please call us at 877-375-2937.

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What’s an IRA and why have one?

An Individual Retirement Account (IRA) is one of the best ways to save for retirement. Money in tax-smart accounts like IRAs and 401(k)s can compound faster than money in taxable accounts. Your IRA contributions can grow tax-free (Roth IRA) or tax-deferred (Traditional IRA), which lets earnings in the account compound over time. Earnings may be withdrawn tax-free from a Roth IRA, assuming five years have passed since the first contribution to the account and you are age 59½ or older. You will pay taxes on distributions from a Traditional IRA based on your tax rate at the time of withdrawal.

What’s the benefit of starting early?

When you start early, even small IRA contributions can have a big impact on your future due to the power of compounded growth. IRA investments are considered tax-smart, which means that your savings can grow faster than in a taxable account. While it’s never too late to start, the later it gets, the more you may have to put away to reach your goal.

If I have a 401(k), should I still open an IRA?

If you have a 401(k) or another qualified employer plan (depending on what your workplace offers) and it provides a matching contribution, that’s usually the best place to start. Depending on your financial plan, you may want to consider opening an IRA as an additional tax-smart account. For more information, read about how to maximize your retirement contributions.

Can I roll over an old 401(k) or other retirement account to an IRA?

If you have assets in an old employer-sponsored retirement plan and you determine that a rollover is the best option for you, it’s easy to move the assets to a Schwab Rollover IRA. You get to keep the tax benefits and choose how your money is invested. This could be the right choice for you if you’ve changed jobs or retired. Please be aware that moving Roth 401(k) assets to a Roth IRA will restart the five-year requirement.

Note: Rolling over your retirement plan account to an IRA (including a Schwab IRA) may not always be your best option. Depending on your circumstances, it may be more advantageous to move your funds to a new employer-sponsored retirement plan.

Prior to making a decision, consider the relevant features and benefits that your new employer-sponsored plan offers, including, but not limited to, potentially lower investment and administrative fees and expenses, investment options that may be available in a new plan but may not be available in an IRA, possible loan provisions, certain distribution options, and protection from creditors and legal judgments.

Additionally, you also have the option to withdraw the balance from your current plan in cash, though you will lose the benefit of tax deferral and may incur tax penalties if you are under age 59½. Please consider all of your options as well as tax considerations specific to your personal situation prior to initiating your plan distribution.

What are the 2017 and 2018 IRA contribution limits?

For both 2017 and 2018:

  • Under age 50: $5,500
  • Age 50 and over: $6,500

What are the fees and minimums for an IRA?

The minimum to open an IRA at Schwab is $1,000—or you can set up an automatic monthly transfer of at least $100.1 And there are no account opening, maintenance, or minimum balance fees.2 Other account fees, fund expenses, and brokerage commissions may apply.

What are my IRA investment choices?

You can choose from a wide range of investments—including mutual funds, stocks, ETFs, bonds, CDs, and more—to help you reach your goals. A Schwab investment professional can help you select the right investments for you during a no-cost consultation3 for Schwab clients.

How do I fund a new Schwab IRA or contribute to an existing one?

You can fund your new Schwab IRA or make contributions to your existing one with an automatic bank transfer by logging in and transferring funds online (for current Schwab clients), dropping off a check at a Schwab branch, or mailing a check.

What do I need to complete my application online?
  • Social Security number
  • Driver’s license number
  • Employer’s name and address (if applicable)
  • Beneficiary Social Security number(s) and contact information
  • Statement from your bank or other financial institution if you’re transferring assets, or cash to fund your new Schwab IRA (recommended)

Already have a Schwab IRA? Log in to contribute.