Investment & Retirement Account - Research Paper Example

Investment and retirement account TD Ameritrade Charles Schwab T. Rowe Price Fidelity Account Minimum Information Cash Account 0 2500Margin Account2000100025001500Retirement Account5500100010001000Commission Schedule – Online TradesMutual FundsNo load- $49.99Online traders- $76Automated phone traders- $76Broker assisted traders- $25$50$40ETFsI internet- $9.99Interactive voice response-$34.99Broker assisted- $44.99Online traders- 8.95Automated phone traders- 8.95+5 service chargeBroker assisted- 8.

95+$25 service charge$10$8.5Fixed IncomeTreasuries at auction- $ 25 flat feeBroker assisted- $25$30$20StocksInternet- $9.99Interactive voice response- $34.99Broker assisted- $44.99Online traders- 8.95Automated phone traders- 8.95+5 service chargeBroker assisted- 8.95+$25 service charge$10$10OptionsInternet- $9.99+0.75 per contractOptions excerise-19.99Interactive voice response- $34.99+0.75 per contractBroker assisted- $44.99+0.75 per contractOnline traders- $8.95+0.75 per contractAutomated phone traders- online price+ $5 service chargeBroker assisted- online pricing+ 425 service charge$10$10Fee ScheduleMaintenance Fees/frequency*00$200Transfer fees$75 for outbound accounts and $25 for wires$8.

95$40$32Additional Services (e.g. research products, local offices, debit cards)Debit accounts and research productsDebit cardsDebit cardsDebit cardsThe account will be opened at Charles Schwab. The account will be a retirement account. The investment will be made in monthly installments. The installments will be safe to use because the movement of the investment can be detected and if it is positive then the investment can continue. The amount to be deposited per month will be $2500. That is the minimum amount that is accepted.

The portfolio will consist of bonds, options, and stocks. The choice of the investment in the portfolio has been determined by the level of risk associated with the different investments and the date of return. Bonds are usually risk free and they are the best investment for retirement purposes. That will ensure that an investor gets assured returns at the end of the year. The use of options is highly risky. However, if the gains are positive, the returns will be high. The other advantage of options is the fact that the returns are usually frequent.

In the case of a person wanting to retire, he/she will be assuring of frequent returns that will be used for survival purposes. Stocks are advantageous because they are a source of accumulating wealth and frequent dividends. The difference between traditional IRA’s and Roth is mainly on the payment of taxes for the deposits. In the case of the traditional IRA, taxes are paid at the end when a person is withdrawing the retirement money. There are some instances when a person can escape taxes in the front end in a case whereby money is put in the account.

In the case off Roth IRA, it is the opposite of that. Taxes are usually paid in the front end and there are no extra taxes at the back end. For both accounts, money usually grows tax free while in the account. The other difference is on the contribution differences. For traditional IRA, anyone who has an earned income can contribute. However, for Roth IRA, there are income limits (rothira.com).ReferencesTraditional IRA vs. Roth IRA. Retrieved on 23rd April 2014. From http://www.rothira.com/traditional-ira-vs-roth-ira