Where Do You Get the Best Roth IRA Rates?

by Ryan Guina

A frequent question I get asked is where to find the Roth IRA with the best interest rates. I applaud anyone seeking to improve his investment returns. Unfortunately, this is a question without a specific answer because a Roth IRA by itself isn’t a fixed rate investment; it is an investment account that can contain multiple types of investments with varying rates of return and amounts of risk.

A Roth IRA is an investment vehicle, not an investment

Best Roth IRA Rates

An IRA is an investment account, not an actual investment.

The first thing we need to do is understand what an IRA is and is not. According to the IRS, an IRA is an Individual Retirement Arrangement or an Individual Retirement Account, depending on how the term is used. The key word here is “Individual.” The person who owns the IRA determines how the assets are invested.

Roth IRAs  are a trust or custodial account designed for special tax benefits. But a Roth IRA by itself is not an investment – it is an account designed to hold investments. The Roth IRA itself is just a piece of paper designating you as the account owner and beneficiary. The trustee or custodian maintains the document and record keeping on your behalf, and works to ensure you maintain certain requirements. From there it is up to you to determine how to allocate your assets as part of your long term retirement plans. If this is not a strong point for you, then consider working with a professional financial advisor to assist you.

Where do you get the best Roth IRAs?

As we mentioned, a Roth IRA is just a vessel for your retirement investments. You can open a Roth IRA with a trustee or custodian at a bank, a federally insured credit union, a savings and loan association, or an entity approved by the IRS to act as trustee or custodian.

How to open an Roth IRA. Starting a Roth IRA is an easy process. Once you ensure you meet eligibility criteria, you will need to select a custodian, fill out some paperwork, select which funds you wish to invest in, and fund your IRA.

Best places to open a Roth IRA. The best place to open an IRA depends on your investment needs. A professional financial planner may be able to open a Roth IRA in your name. You can also open a Roth IRA with many banks and credit unions, as well as a variety of mutual fund houses and brokerage firms. You should make your decision based on your investment needs and style.

If you need assistance with your investments, then a professional advisor or broker may be the best option for you. If you are a hands on investor, then you may wish to take a look at the best Roth IRA brokerages, some of which include TradeKing, E*Trade, and TD Ameritrade.

Where are the best Roth IRA rates?

Because Roth IRAs are individual accounts and you can invest in virtually anything, you will need to search out the best investment that meets your needs and risk tolerance. If you are looking for a guaranteed interest rate, then consider a Certificate of Deposit (CD) or government bonds. If you are willing to assume more risk and potential reward, then you may be better investing in equities, REITs, or other investments. Roth IRAs can hold almost any type of investment, therefore the rate you receive is subject to the type of investments you use in your Roth IRA.

Published or updated July 26, 2015.
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{ 9 comments… read them below or add one }

1 george fuller

My question is:
What type of return should I expect on the different investment options associated with IRA’s.



I have some retirement funds in my FERS-TSP account and i plan to move them to another account..I retired on disability because I am waiting for a kidney transplant..I need to move my funds for the following reasons, 1)to earn an interest 2) have access to the funds for emergency purposes3) be able to wihdraw funds if I need be, What do you suggest is the best thing that I should do, Mutual fund company or brolerage firm. Thank you


3 Ryan Guina

I’m sorry to hear about your condition, Jose. My recommendation would be to maintain your funds in the TSP for now, and then withdraw them if/when they are needed. You really won’t gain much by transferring them to a mutual fund company or brokerage firm. The important thing for now is to leave your funds in a retirement plan as long as possible, otherwise you may be subjected to taxes (based on your income rate) and early withdrawal penalties (10% of your withdrawal). The taxes + withdrawal penalties can easily add up to a third of your withdrawal, depending on your situation. You can always withdraw your funds from the TSP on an emergency basis.

If you have something else in mind, then I recommend speaking with a financial planner who can help you understand all of your options and give you a personalized recommendation. Best of luck and I hope your health improves.


4 Kat

With interest rates so low, is it wise to invest in a savings type of Roth IRA as opposed to an investment account? I have no understanding of the world of finance and just want to build a reliable nest egg as I am self-employed.


5 Ryan Guina

Kat, investing a Roth IRA in a savings account may not be a good idea if this is your only retirement investing and you have a long time frame before you will need the money. This is a longer conversation than I can handle in a comment, so I dedicated an entire article to it: Should You Invest Your IRA in a Savings Account or CD? For Most People the Answer is No. I hope this gives you something to think about and a good starting point to learn more about investing.


6 DeeKay

Why would you want to take any of your money out of TSP? I am retired from the Government and left my money in their because of the great returns I’ve been getting for years now. I still have 50% of my account in stocks and 5% in bonds, rest in the other funds. In 2013 my investments were up 25%. Still get a return of at least 12% or more consistently. You can always take loans against your money if you need it for emergencies.


7 Jordan

I am a 22 year old trying to understand more about roth IRA’s. I can’t find what seems to be a realistic interest rate.


8 Ryan Guina

Jordan, as described in the article, the only fixed “rates” are what you will get with a fixed deposit account such as Certificate of Deposit (CD) or savings account, both of which currently offer very low returns that aren’t appropriate for most young investors. You won’t lose money with those instruments, but your earnings won’t keep pace with inflation either. If you are new to investing, I recommend reading our beginning investors guide, which will help you get started. Happy investing!


9 Zee denny

I have about 150 thousand to invest, that is if I sell a house that I got in a divorce. The house gives me 1000 cash flow monthly, but also have to pay 8 in taxes do i have 4 k left for maintenance. Should i sell and work with this little money else were.
I am 60 now


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