Jan 21

I would like to open a Roth IRA. Do the interest rates or rates of return differ between Vanguard, Fidelity, my personal bank, etc. just as the interest on a savings account a different banks would differ? If so, do these rates fluctuate daily? Does anyone know whose rates are consistently higher? Can I have more than one Roth? Can I have a Roth AND a Traditional IRA?

2 comments so far...

  • tnspro22 Said on January 21st, 2010 at 10:30 pm:

    Your rate of return will depend more on what funds you decide to invest in rather than what company you decide to invest with. Most mutual funds have different investment objectives to match individual investor’s unique goals. How you allocate your funds between asset classes (stocks, bonds, cash, etc.) will determine your potential return. Also, your investment time horizon (how long before you use the money) will also factor into your potential rate of return.

    You can have as many Roth IRAs as you want but you cannot contribute more than the maximum $4,000 a year collectively.

    You can also have a traditional IRA and a Roth but you still are limited to the $4,000 maximum combined. For example, you could contribute $2,000 to each IRA but not $4,000 to each.

  • Quixotic Said on January 21st, 2010 at 10:39 pm:

    It depends on what you invest in.

    If you invest in a Certificate of Deposit, then yes, the interest rate will be locked in at the time you invest it (i.e. 5.20% for 5 years).
    Other investments, like money market funds will change interest rates every day. And stock funds will fluctuate every day, sometimes losing money.

    Yes you can have both a Roth and a Traditional IRA (assuming your income is low enough).

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