Saving for retirement is a lifelong journey, and the earlier you begin, the better off you’ll be. Yet, many Americans struggle to save for retirement due to living paycheck-to-paycheck. To address this challenge, numerous investment firms are enticing new customers to start saving by offering substantial cash bonuses.
The terms, conditions, and bonus amounts vary among companies, but the objective remains consistent: by initiating retirement contributions, you receive a cash bonus from the chosen investment firm, bolstering your retirement savings. Before delving into which companies offer these bonuses, let’s review the fundamentals of a Roth IRA.
What Is a Roth IRA?
An IRA, or Individual Retirement Account, is a tax-advantaged investment vehicle designed to help individuals save for retirement. A Roth IRA is a specific type of IRA that offers tax benefits. Unlike a 401(k) plan, which uses pre-taxed income, Roth IRAs are funded with after-tax income. While you pay taxes on the money you contribute to a Roth IRA, your contributions can grow tax-free over time. Additionally, withdrawals made after reaching the age of 59 and a half are tax-free, providing a valuable source of retirement income.
Roth IRAs come with certain eligibility criteria and contribution limits. Individuals with incomes exceeding $144,000, or $214,000 for married couples filing jointly, are ineligible to contribute to a Roth IRA. The annual contribution limit is $6,000 per year, or $7,000 for individuals aged 50 and above. Many people opt for a Roth IRA if they anticipate having a higher tax rate in retirement than their current rate. It also serves as a strategy for tax diversification, allowing individuals to pay income tax on some retirement income sources while avoiding it on others.
E*Trade
E*Trade is offering a bonus of up to $600 or more when you open a new brokerage or retirement account, along with the potential for $0 commission fees. However, the exact bonus amount can be ambiguous, as it could reach up to $3,500 in free money. To qualify for this maximum bonus, you would need to deposit at least $1.5 million into your new account within 60 days of opening it, which might not be feasible for most individuals.
However, this offer could be particularly appealing for those with old 401(k) or 403(b) accounts from previous jobs. Despite no longer working for those companies, your money remains in those accounts. By transferring these funds into a new E*Trade Roth IRA, you could be eligible for a substantial cash bonus, providing a lucrative opportunity for boosting your retirement savings.
Fidelity
Fidelity’s bonus offer might not be as high, but it’s incredibly straightforward to qualify for. Just open an eligible Roth IRA account and deposit a minimum of $50, and Fidelity will add $100 more directly to your account. There are no complicated conditions or requirements to meet, although you must leave the bonus funds in your account for at least 90 days, which shouldn’t pose an issue if it’s a retirement account you’re opening.
This offer applies to various Fidelity products, such as Roth IRAs, standard IRAs, Fidelity investment accounts, or the Fidelity Cash Management Account. However, you must open the account through the Fidelity Starter Pack webpage and use their specific promo code to be eligible; opening the account in person or over the phone won’t qualify you for the bonus.
Ally Invest
If you’ve already got some savings but want to take a more hands-on approach with your investments, consider Ally Invest. They give cash bonuses for new Self-Directed investment accounts, but you’ll need a minimum of $10,000 in assets to snag even the smallest bonus of $100. The bonus increases gradually, reaching up to $3,000 if you can roll over more than $2 million into your account.
Ally Invest provides a sleek online trading platform, complete with a mobile app, and offers commission-free ETF and stock trading. However, remember you’ll need at least $10,000 to qualify for any bonus, and this option doesn’t come with professional investing guidance. In short, it’s best suited for those who feel confident managing their investments independently.
TD Ameritrade
TD Ameritrade offers cash bonuses similar to Ally Investments, but you’ll need substantial initial assets to qualify for the largest bonuses. To receive the highest bonus of $2,500, you’ll need to deposit at least $2 million initially. Even the smallest bonus of $350 requires an initial deposit of $250,000.
If you’ve been diligently saving or have a sizable sum to invest, TD Ameritrade could be an excellent choice. Their professionally managed portfolios are supported by one of the most reputable names in finance. Moreover, you can earn this bonus on various account types, including education accounts and specialty accounts like trusts, pensions, or business partnerships.