One of my goals in mobilizing the Roth IRA movement was that I was hopeful that many young adults would get inspired and, in turn, open up their first Roth IRA.

I knew, however, that while some would take the initiative and actually do it, there would be many others who would be overwhelmed with all the different options that exist.

I then became determined, a.k.a. obsessed, in trying to find the viable option for someone who was a novice investor, on how they could get started in opening a Roth IRA.

Knowing that most GenX and GenY members are online and tech savvy, I figured it would make sense to try to find an online brokerage that would be easy to maneuver.

The video above shows how to maneuver a Scottrade account once it’s opened. The video will show you how to:

  1. Transfer money electronically into your Scottrade account
  2. Use their mutual fund screener tool to weed out the funds that have transaction costs and the ones that have been consistently poor performers.
  3. Find the no transaction ETF’s that Scottrade offers

Now there are several different options out there, Schwab, E*TRADE, TradeKing, Betterment. FYI – if you want to see a comprehensive review on Betterment, go here. I’m sure all of these have plus and minuses in going with them.

The one that I have decided to focus most of my efforts on was Scottrade. Why Scottrade you ask? Really for the mere purpose that Scottrade is located in St. Louis, which is about 90 minutes from where I live. Plus, I have been in the Scottrade Center on several occasions to witness several sporting events. Is that a good enough reason? Let’s just say it was for me. :)

I first have to confess; I have been a financial advisor for over ten years now and I know first hand how easy it is to open an account at my firm or any of my competitors. I was not versed, however; on how to open up an account online. I assumed it would be easy, but didn’t really know what it all entailed.

So how do you find out how something works if you have never done it before? You take it for a test drive of course!

The first thing I did was I called the Scottrade toll free number and talked to one of their customer service representatives. I explained to them that I was a financial advisor and was interested to learn the process of how a new customer would open a new account with them.

They were very helpful and I learned a lot about their platform. I was excited to learn that although on some of their advertising they suggest that you have at least $500 to get started, it’s just that – a suggestion.

In all actuality, you don’t need $500 to open the account; you don’t need anything for that matter.

Obviously you have to have money in the account to purchase some investments. I also learned that there are no annual fees for owning the account. You can call their toll free number at your convenience and get help that has several locations that you can go visit, and they also had over 3,000 mutual funds and several ETFs that you can purchase at no transaction charge whatsoever. The more I learned about them the more I became impressed with their operation.

In all Scottrade has access to over 14,500 different mutual funds with 3,100 of them having no transaction charge.

Now making a phone call and learning about something is one thing, but until you actually test drive it itself, it is hard to teach somebody how to use this. So I figured the only way I could really understand the Scottrade system was to open an account myself, which I did.

Because of the title of the post and talking about ordering a Roth IRA, that was my hope, but alas, I have exceeded income limits, so therefore, I can no longer participate in a Roth IRA. So for this purpose, I have opened up an individual account just so we could see the behind the scenes platform of how Scottrade works.

Welcome to Scottrade

Opening your account with Scottrade is super easy.

Starting with their site, they’ll walk you through a several step process of just collecting personal information; name, date of birth, address, social, etc.  If you’re opening an IRA you want to have your beneficiary information available as well.  Once you get all the pertinent data entered in, you’ll then be asked to print off a form or two that you’ll need to sign and physically mail in to their home office.

Scottrade forms and applications

All in all, I am pretty sure I had the account open in less than ten minutes.

Funding Your Scottrade Account

The next step will be funding your account.  If you have a brick and mortar location close to you, it’s as simple as dropping, leaving them a check and voila your new account is funded.  If you don’t have the luxury of a brick and mortar location available to you, you can either mail in checks or you could setup your bank account to be connected with your nee Scottrade account.

If you have online checking it’s pretty easy to get it setup.  We’re currently in the middle of having a few issues with our online checking for various reasons, so it wasn’t as easy for me to get it setup.  That was more my bank issue and not as much Scottrade.

In my case I had to setup a money deposit where there would be two random and small deposited to our checking account.  I would then to verify those amounts to Scottrade to show that I in fact was setting up my own checking account with them.  After a few days the amount showed up and I was able to log back into my Scottrade account and verify that I was in fact me.

Scottrade Customer Service

One of the things that really impressed me the most when opening my account with Scottrade was the next morning I received a phone call from the closest branch to me.    I must admit that I was thoroughly impressed by this.  Typically when you think of an online company, you don’t expect as much getting a phone call from a real live person following up with you.  It ended up being their branch manager nonetheless.  She was able to walk me through some of the basic items and how to make my first purchase with them.

I never felt like I asked too many questions and never felt like I was being rushed off the phone.  I think those aspects are huge, especially if you’re a new investor and the whole process if overwhelming.  How helpful to have someone on the phone to help you every step of the way, and the best part is, is that it’s free.  It’s all part of the Scottrade package.

Scottrade welcome email

Do You Want to Learn More about Scottrade? Find out how easy it is to open an account and get started today.


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Comments | 2 Responses

  1. says

    I definitely think people should open up Roth IRAs if possible and I hope your tutorial helps people to realize it isn’t as complicated as they probably think it is. I use Vanguard and they have a similar process but they do have minimums for their funds.

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