You can open a Roth IRA at a bank, brokerage firm, or robo-advisor, and the choice depends on how much you want to manage yourself and what fees you can accept
A Roth IRA is a retirement account you can open anywhere that holds investments — banks, brokerages, and online platforms all offer them. The account itself is free to open. What varies is the cost to hold money in it, the types of investments available, and how much help you get choosing where to put your money. You do not need to go through your employer or a government office; you open it directly with the financial institution you choose.
The three main routes are a traditional brokerage (like Fidelity or Charles Schwab), a bank (like Chase or your local credit union), or a robo-advisor (like Betterment or Vanguard Personal Advisor Services). Each has different minimums, fees, and investment options. Your choice matters because you will be using this account for decades, and switching later costs time and sometimes money.
Key Takeaways
- Brokerages offer the widest range of investments and often charge no account fees, but require you to pick individual stocks, bonds, or funds yourself.
- Banks are simple and familiar but usually offer only their own products and may charge monthly maintenance fees if your balance is low.
- Robo-advisors automatically build and rebalance a portfolio for you, charging 0.25% to 0.50% per year, and work best if you have at least $500 to $1,000 to start.
- You need a Social Security number and proof of income to open any account, and you can only contribute money you actually earned that year.
- Opening takes 10 to 20 minutes online, and you can start investing the same day or wait until you have saved more money.
Brokerages: The widest choice, lowest fees, but you decide what to buy
A brokerage is a company that lets you buy and sell investments — stocks, bonds, mutual funds, exchange-traded funds (ETFs). Major brokerages like Fidelity, Charles Schwab, E*TRADE, and TD Ameritrade all offer Roth IRAs with no account opening fee and no monthly maintenance fee. They make money when you trade (though many trades are now commission-free) or by lending out your cash when you are not using it.
The trade-off is that you have to decide what to invest in. A brokerage gives you the tools and research, but the choice is yours. If you want to buy individual stocks or build a specific mix of index funds, a brokerage is the right place. If you have no idea what to buy and do not want to learn, a brokerage will feel overwhelming. Most brokerages have a minimum opening balance of $0 to $500, though some funds within them have higher minimums.
Opening at a brokerage takes about 15 minutes online. You will need your Social Security number, date of birth, address, and employment information. Once your account is open, you can transfer money in and start investing immediately, or you can wait until you have saved more.
Banks: Familiar and simple, but limited options and possible fees
You can open a Roth IRA at your bank — Chase, Bank of America, Wells Fargo, or your local credit union all offer them. The advantage is familiarity: you already have a relationship with the bank, you can walk in and talk to someone, and the process feels straightforward. The disadvantage is that banks usually offer only their own products — certificates of deposit (CDs), money market accounts, and sometimes mutual funds — rather than the full range of stocks and ETFs a brokerage offers.
Banks often charge a monthly maintenance fee ($5 to $15) if your balance falls below a threshold, usually $500 to $2,500. Some waive the fee if you set up automatic monthly deposits or keep a linked checking account. If you are just starting to save and your balance will be small for a while, these fees add up. A brokerage with no maintenance fee is usually cheaper in that situation.
Opening at a bank takes 10 to 20 minutes, either online or in person. You will need the same documents as a brokerage: Social Security number, ID, address, and proof of income. If you open in person, a banker can walk you through the choices, which helps if you are new to retirement accounts.
Robo-advisors: Automatic investing, but you pay a yearly percentage
A robo-advisor is a company that builds and manages an investment portfolio for you based on your age and risk tolerance. You answer a few questions about when you plan to retire and how comfortable you are with market ups and downs, and the robo-advisor puts your money into a mix of funds that matches your answers. It then rebalances automatically — selling winners and buying losers to keep your mix steady — without you having to do anything.
Robo-advisors charge a yearly fee of 0.25% to 0.50% of the money you have in the account. On $10,000, that is $25 to $50 per year. On $100,000, that is $250 to $500 per year. Some robo-advisors waive the fee if your balance is below a certain amount or if you also have other accounts with them. Vanguard Personal Advisor Services, Betterment, Wealthfront, and Schwab Intelligent Portfolios all offer Roth IRAs.
Robo-advisors work best if you have at least $500 to $1,000 to start and you do not want to think about your investments. They are more expensive than a brokerage with index funds, but cheaper than hiring a human financial advisor. Opening takes 10 to 15 minutes online, and you need the same documents as a bank or brokerage.
What you need to open an account
Every financial institution that offers a Roth IRA will ask for the same basic information. You will need your Social Security number, date of birth, current address, and employment information — your employer's name and your job title. Some will also ask for your annual income or how much you earned last year, because Roth IRA contributions are limited based on income.
You do not need to bring physical documents to open online, but you should have them nearby: a government-issued ID (driver's license or passport), a recent pay stub or tax return showing your income, and your Social Security card or a document with your number on it. If you open in person at a bank, bring your ID and proof of address (a utility bill or lease works).
The entire process takes 10 to 20 minutes. Once you submit your information, the institution will verify it — usually within a few minutes online, or within one business day if you open in person. You can then link a bank account to transfer money in, or you can wait and transfer money later.
How much it costs to open and maintain
Opening a Roth IRA is free at every institution. There is no application fee, no setup fee, and no deposit requirement at most brokerages. Some banks and robo-advisors have minimum opening balances of $500 to $1,000, but many do not.
What costs money is holding the account over time. Brokerages typically charge nothing per month or per year, though they may charge a fee if you trade individual stocks frequently (though most have eliminated these commissions). Banks charge $5 to $15 per month if your balance is below their threshold. Robo-advisors charge 0.25% to 0.50% per year of your balance. If you invest in mutual funds or ETFs, you also pay the fund's own expense ratio — usually 0.03% to 0.50% per year — but this is the same no matter where you open the account.
Over 30 years, the difference between a 0.03% expense ratio and a 0.50% one compounds significantly. A $10,000 investment growing at 7% per year costs you roughly $30,000 more over 30 years if the fee is 0.50% instead of 0.03%. This is why choosing a low-cost option matters, especially when you are starting out.
Comparing your options side by side
| Option | Opening Fee | Monthly/Yearly Cost | Minimum Balance | Best For |
|---|---|---|---|---|
| Brokerage (Fidelity, Schwab, E*TRADE) | Free | $0/month | $0–$500 | People who want to choose their own investments and pay low fees |
| Bank (Chase, Bank of America, credit union) | Free | $5–$15/month if balance is low | $500–$2,500 (varies) | People who want simplicity and already bank there |
| Robo-advisor (Betterment, Vanguard, Wealthfront) | Free | 0.25%–0.50% per year | $500–$1,000 | People who want automatic investing and do not want to pick investments |
Frequently Asked Questions
Can I open a Roth IRA if I do not have a job?
No. You can only contribute money you earned from work — a W-2 job, self-employment income, or gig work like freelancing. If you have no earned income, you cannot open a Roth IRA. A spouse with earned income can open a spousal Roth IRA for a non-working spouse, but the working spouse must have enough income to cover both contributions.
Do I have to open a Roth IRA where I have my checking account?
No. You can open a Roth IRA anywhere and keep your checking account somewhere else. Many people open a Roth IRA at a brokerage like Fidelity and keep their checking account at their local bank. You will just need to link the two accounts to transfer money between them.
What happens if I open an account but do not put money in right away?
Nothing. The account sits empty and costs you nothing. You can open it now and start contributing whenever you have money saved. Some people open an account early so they understand how it works before they start investing.
Can I move my Roth IRA to a different institution later?
Yes. You can transfer your account to another brokerage, bank, or robo-advisor without paying taxes or penalties. The process is called a direct transfer and usually takes one to two weeks. You may pay a small transfer fee ($0 to $100) at your old institution, though many waive it.
Which option is cheapest over time?
A brokerage with low-cost index funds is usually cheapest — you pay nothing per month and 0.03% to 0.10% per year in fund fees. A robo-advisor costs more (0.25% to 0.50% per year) but saves you time. A bank is cheapest only if your balance stays above the minimum and you do not mind limited investment choices.