A Roth IRA allows you to contribute after-tax dollars. When IRS requirements are met, qualified earnings and withdrawals can be tax-free in retirement after age 59½ and the five-year holding rule. It differs from 401(k)s and traditional IRAs in several key ways that investors may find relevant.
Contribution rules, income eligibility limits, and investment choices may all impact how this account fits into your retirement planning.
In this guide, you’ll learn where you can open a Roth IRA, how the process works specifically on Public.com, what tools are available to you once the account is set up.
Where can you open a Roth IRA?
IRS suggests that investors should open a Roth IRA with approved trustees or custodians, i.e., a bank, federally-insured credit union, savings and loan association, or another entity approved by the IRS to act in that capacity.:
1. Online brokerages
Online brokerages are one of the most common places to open a Roth IRA. These platforms give you access to a wide selection of investments like stocks, ETFs, bonds, cryptos, U.S. treasuries, high-yield cash accounts and sometimes alternative assets.
For example, on Public.com, you can open a Roth IRA alongside other investment accounts you may already hold. Public allows you to invest in stocks, ETFs, Treasuries, and even options within an IRA. It also offers features such as a 1% IRA match, which may help you grow your retirement contributions, and API access for automating trades if you prefer programmatic investing.
2. Banks and credit unions
Many national and regional banks, plus credit unions, may allow you to open a Roth IRA alongside deposit accounts. These often have limited investment options that focus on CDs, savings products, or proprietary mutual funds.
3. Robo-advisors and investing apps
Automated investment platforms typically build and rebalance diversified ETF portfolios for a stated management fee, which might be lower than full-service advisory costs.
How to open a Roth IRA on Public.com
The Roth IRA opening process typically involves five key steps, from eligibility verification through account management. Let’s understand them in more detail.
Step 1 – Confirm your eligibility
Eligibility requirements for Roth IRA contributions include having earned income and meeting specific income thresholds. You may need to verify that your current year’s modified adjusted gross income falls within allowable limits based on your filing status (see table below).
Note: IRS rules limit your Roth IRA contribution to the lesser of your earned income or the annual maximum.
Step 2 – Open your Roth IRA on Public
To open a Roth IRA on Public.com download the app on iOS or Android, and sign up.
Create an account in the app.
After you download and sign up, you can open a Roth IRA through either of these paths.
Navigate to “Portfolio” → Build Your Portfolio → Individual Retirement Accounts.
or
Open the ≡ menu, choose “Account Settings”, and tap Open IRA > Select Roth IRA.
Public app may request basic personal information, employment details, and funding preferences before displaying required disclosures. During the selection process, you might also see the Public’s 1% IRA match program for qualifying contributions, rollovers, and transfers.
Step 3 – Fund your IRA and set up a contribution
Once your IRA is set up, you can start contributing by:
- Linking a Bank Account: Transfer funds securely via ACH or debit card.
- Rolling Over an Existing IRA or 401(k): If you have a retirement account with another provider, Public.com supports rollovers, allowing you to consolidate and manage your investments in one place.
To stay on track with your retirement savings goals, you can set up one-time or automatic contributions:
- One-time deposits: Make individual contributions whenever it fits your financial plan.
- Automatic contributions: Set up recurring deposits to ensure consistent contributions over time, helping to maximize potential tax benefits and long-term growth.
Step 4 – Choose your investments
Once your Roth IRA is funded, you may select what to hold. Public lets you invest in stocks, ETF’s, bonds, options.
Step 5 – Automate and monitor
Public.com allows you to automate recurring contributions so that money is regularly added to your Roth IRA. You can also monitor your account through the app, track performance, and adjust your investment mix as needed.
Top features of Public’s Roth IRA account
Conclusion
Opening a Roth IRA gives you access to a retirement savings vehicle where contributions are made with after-tax dollars and qualified withdrawals in retirement are tax-free. Roth IRA planning may complement existing retirement strategies through tax diversification. You can open an account through brokerages, banks, robo-advisors, or other financial institutions, each offering different features and investment options.
By understanding eligibility rules, contribution limits, and the steps involved in opening and managing the account, you can decide how a Roth IRA fits into your overall retirement planning.
