The Smart Way to Open a New Retirement Account
When it comes to opening a new retirement account, starting out on the right foot is crucial. It doesn't matter if this is your first ever retirement account or your 17th; or if it's a traditional 401(k) or a Roth IRA. Picking the right account trustee, types of investments, and contribution schedule can make all the difference between hitting your savings goals or missing them by a mile.
A retirement account trustee is the entity responsible for providing and maintaining the account, and is usually a bank or brokerage firm. For employer-provided retirement accounts such as 401(k)s, you probably don't have any input into the choice of trustees. However, if you complain loudly enough about a bad trustee and perhaps get your coworkers to complain as well, you may just be able to convince HR to make some changes. With IRAs, fortunately, you have an enormous group of potential trustees to choose from, and the decision is entirely up to you.
Things to look for in a trustee include a large number of investment options, low fees, easy access to the account, solid contribution options, and decent customer service. 401(k)s generally only offer the option of contributing from your pre-tax paycheck, but it's nice to be able to adjust your contribution level right on the trustee's website instead of having to fill out paperwork with HR every time you want to make a change.
Source: Fool.com
