TD Ameritrade IRA Accounts
The online broker TD Ameritrade leads the field with an outstanding online platform and mobile app offering, backed up by very good customer service. They offer the full range of IRA accounts including Traditional, Roth, Rollover, SEP and SIMPLE IRA accounts. An incentive is offered to sign up for a new online account.
Online users give the TD Ameritrade experience a solid thumbs-up. Note that they charge $9.99 per trade, around twice the rate of discount online brokers. Generally, devotees of TD Ameritrade feel that the quality and value received is worth the higher price.
Opening a TD Ameritrade Account
Opening an IRA account with TD Ameritrade is a smooth, straightforward experience. They offer a new account promotion for 60 days of free trading and a bonus of up to $600. Click through the promotion and hit the new account button, where you enter personal information, your social security number and employer details.
Account Details and Fees
The flat-rate fee of $9.99 per trade is charged on purchases of stocks and ETFs (Exchange Traded Funds). Options trading also incurs a $9.99 fee, plus $.75 per contract. TD Ameritrade has no IRA maintenance or inactivity fees, except for an outgoing transfer charge. The fee structure is similar to Etrade, but costs more than competitor Scottrade. These high fees are mitigated by access to 24/7 support, great trading platforms, outstanding research and real-time streaming quotes.
Commission Free Trades
TD Ameritrade does offer 101 commission-free ETFs, but if you sell within 30 days of purchase you pay a short-term trading fee of $19.99. Customers can access an impressive selection of no-transaction-fee mutual funds. Between the commission-free ETFs and the mutual funds, there are a lot of options to invest your IRA in funds where you pay no commission. Be sure to check out the no fee mutual funds, as the usual mutual fund transaction fee is a whopping $49.99.
As noted, TD Ameritrade offers the full range of IRA account types, including options for the self-employed. Unlike most brokers, there is no minimum deposit required to start your IRA. You can literally start the account with no deposit and fund it later.
Kiplingers magazine calls TD Ameritrade "The best brokerage firm for your IRA", and Barron's rated the company highly for Beginner Investors and for Long Term Investing, citing top performance in Mobile Trading, Range of Offerings, Research Tools and Customer Satisfaction.
Research Tools and Resources
IRA account holders with TD Ameritrade have access to an industry-leading menu of free services. These include a dividend reinvestment plan, free streaming quotes, proprietary video content, and access to two distinct trading platforms. There is a superb range of third-party investment research from S&P Capital, Morningstar, Capital IQ, Jaywalk and other financial experts available.
For those keen on learning about investing and trading, TD Ameritrade has an Investors School available via webcasts. The idea here is the more you know, the better you'll trade. Many users combine the webcast school with other investor education resources to sharpen their skills. While many IRA investors will stick to tried-and-true mutual funds, the education section of the TD Ameritrade site is a great resource for those interested in new areas like bonds or options.
The retirement section of the site is particularly useful for investors interested in building long-term wealth, as opposed to the volatile world of day trading. The retirement planning page is chock full of tools geared toward retirement investing. There are also referrals to financial planners at the retirement planning page.
Platforms & Tools
There are two platforms available to account holders at TD Ameritrade. Their main platform is called thinkorswim, which they acquired in 2009. While any client can use the platform easily, it offers the complete flexibility and depth that advanced traders need.
There is also the web-based platform Trade Architect, designed for the casual investor. The streamlined platform is simple and easy to use and performs well. The only drawback of Trade Architect is that there is no virtual trading support.
Mobile Trading Apps
Likewise, TD Ameritrade developed two smartphone trading apps. TD Ameritrade Mobile is a straightforward app for casual investors and those new to investing. TD Ameritrade Mobile Trader is a more robust app with all the bells and whistles the active trader will enjoy.
TD Ameritrade Pros
Investors at every level of experience are able to find the right tools for a satisfying user experience at TD Ameritrade, along with a bundle of outstanding services that many firms do not offer. The services include streaming quotes, dividend reinvestment on stocks and mutual funds, virtual trading to try out strategies, and third party investment research.
TD Ameritrade Cons
TD Ameritrade is at the higher end of the fee scale for online brokerage companies. In their defense, many of their support services are provided at no extra charge, while some discount brokers charge for extra services on a piece-meal basis.
Customer Service at TD Ameritrade
It's hard to argue with 24/7 customer support via phone or email. Emails are returned within a few hours. The phone system is easy to use and connects you quickly to an actual human being. With a full-service broker, clients expect good customer service, and generally receive it via the email and phone options.
Clients using the thinkorswim platform also have access to live chat support. Visitors to the site will trigger a live chat popup if they linger long enough. The live chat option could be expanded to all customers to improve customer service.
Verdict - Great
On balance, TD Ameritrade does an outstanding job helping people save and invest for retirement. There are no fees, free tools, and a great user interface. When you open an account, you get 60 days of free trading and a cash bonus of up to $600.
It's a great choice for investors who choose to invest their IRA in a mutual fund, but it could be a bit expensive for those who like to trade stocks and ETFs on a regular basis. Some will complain about the transaction fees, but for many the top quality resources and service make it well worth the cost.