By: Bob Haegele
October 16, 2021In a nutshell: SoFi Invest offers Roth IRA accounts to help you make the most of tax-free withdrawals upon retirement. With a choice of active or automated investing with no fees, our SoFi review agrees that this is one of the best ways to grow your retirement fund.
Pros and Cons of SoFi Roth IRA
Pros
- No trading fees
- Wide number of asset classes
- Active or automated trading
Cons
- $75 account migration fee
- Basic research tools
SoFi Invest Roth IRA Review Introduction
Our main review on SoFi Invest maintains that this platform is a game changer. When it comes to planning for your retirement, a Roth IRA account enables you to pay tax on your income but benefit from no tax on withdrawals when you retire. If you believe your account is going to grow (and it should!), then this is an extremely tax-efficient way of preparing for your retirement.
SoFi’s main draw is being able to invest without any trading fees, no account minimums, and no commissions. In fact, there are no fees at all. Considering the fact that annual Roth IRA contribution limits are currently set at $6,000, or $7,000 for over 50s, every dollar counts.
Keep reading our SoFi Roth IRA review to find out more about why this is the ideal platform for a retirement account.
What is a SoFi Roth IRA?
SoFi was initially launched by business students from Stanford in 2011, but it wasn’t until 2019 that SoFi Invest was launched. Various types of IRA would be supported soon after.
With more than $12 billion in assets held under the SoFi banner, investors have quickly jumped onto this roboadvisor due to their low-fee, no-nonsense approach.
Its position as a roboadvisor means it specializes in helping ordinary people to enter the market for the first time. With their Roth IRA accounts, you can take control of your financial future.
Under SoFi Securities, all Roth IRA accounts are FDIC insured up to $500,000 in securities and $250,000 cash, so you know your money is safe.
SoFi Roth IRA Features
Our SoFi review made it clear that the features provided by this platform are revolutionary. Make managing your Roth IRA simple with SoFi.
Here are the main features relevant to your SoFi IRA account.
Automated Investing
SoFi’s flagship feature can also be used for your Roth IRA account. Automated investing allows you to invest with confidence, even if you have no prior experience in the market.
When you create a SoFi account and choose a Roth IRA, you’ll be able to select from 10 prebuilt portfolios and 13 different asset classes. All you need to do is determine your own personal risk tolerance.
SoFi portfolios consist mainly of ETFs from big names, including Vanguard and iShares. They also have their own ETFs.
One fee you will need to pay is expense ratios. These are levied not by SoFi but the ETF provider. Thankfully, fees are extremely low at just 0.05%.
Fractional Share Trading
Due to the low permitted annual contribution limits, it can be difficult to make your money work for you. Under the current annual limits, that only amounts to two or three shares in Amazon.
SoFi allows fractional share trading, known as “Stock Bits”. Whenever you deposit into your Roth IRA, your money can be automatically invested, so every dollar is constantly gaining exposure to the market.
Free Access to Financial Advisors
Planning for your retirement is tough. Your decisions now will impact you decades from now. Forget traditional financial advisors and choose a SoFi financial advisor instead.
Every Roth IRA account holder gains access to a qualified financial advisor who can guide you on best practices for your Roth IRA and how to maximize your gains.
It’s a cool feature not offered by many other investment platforms, at least not for free.
SoFi Roth IRA Fees
Holding a Roth IRA with SoFi doesn’t make you eligible for any additional fees. You have the same rights as someone with a standard investment account, including:
- No account minimums
- No trading fees
- No management fees
- No commissions
The only fees involved are the 0.05% ETF expense ratio and a $75 account migration fee if you choose to leave the platform.
SoFi Roth IRA FAQ
If you’re wondering whether opening a Roth IRA with SoFi Investing is the right move, here are the answers to some of the most common questions.
How much can I contribute to my Roth IRA?
These limits are set by the Federal government and are currently $6,000 per year for under 50s and $7,000 per year for over 50s.
Is my retirement account protected?
Yes, all SoFi investing accounts are FDIC insured up to $250,000 cash.
Can I actively invest my money?
Yes, you’re not compelled to use the SoFi Automated Investing. You can also use SoFi’s Active Invest to choose your own investments.
SoFi Roth IRA: Is it Right for You?
Retirement planning is difficult but this SoFi Roth IRA review believes that this platform has simplified the process.
For beginners, the automated investment option and free access to human financial advisors is a great way to get started.
Learn more by reading our full SoFi Invest review now.
If you’re ready to create your SoFi Roth IRA, sign up and invest for free now.
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