Traditional IRA
Reward your future self with a tax-deferred traditional IRA.
Save now and handle taxes later. With a Traditional IRA, your retirement savings aren’t taxed until you withdraw them in retirement.
What is a traditional IRA?
A traditional individual retirement account (IRA) is a tax-advantaged retirement savings account that anyone with earned income can contribute to. When you add money to your account, the tax-deductibility of your contributions may depend on your income bracket, but your investments will grow tax-deferred until you withdraw them during retirement (unlike a Roth IRA, where contributions are made with after-tax dollars).
Kickstart your retirement with a traditional IRA.
Tax-deferred benefits.
Potential earnings accumulate without worrying about annual taxes—you only pay tax when you withdraw your money.
Secure retirement income.
A traditional IRA can help you have the retirement you’ve dreamed of. Consider pairing your IRA with a 401(k) to potentially improve your savings.
Potential tax deductions.
Depending on your income and if you have an employer-sponsored 401(k), you may be eligible for a tax deduction from your IRA contributions.
Simple setup process.
Typically, you can open a traditional IRA online in just a few minutes.
Estimate your IRA balance at retirement.
Use SoFi's IRA calculator to find out how much your retirement savings could accumulate over time.
Traditional IRAs vs. Roth IRAs
In some cases, it may make sense to open a Roth IRA instead of or in addition to a traditional IRA. While contributions to a traditional IRA may be tax-deductible, you'll owe taxes on withdrawals later. With a Roth IRA, contributions are made with after-tax dollars, but qualified withdrawals in retirement are tax-free. Factors like your current income, tax bracket, and retirement goals all play a role in helping you decide between a Roth IRA versus a traditional IRA.
Why choose a SoFi traditional IRA?
There's plenty to love about traditional IRAs, and SoFi adds even more to the list.
Automated or self-directed investing.
Choose to take control with self-directed investments or experience the ease of automated investing.
Personalized advice and guidance.
Book a complimentary 30-min session with a SoFi Financial Planner.
Portfolio diversification.
Diversify your portfolio with flexible investment options, including:
Ease and accessibility.
Enjoy a user-friendly and easily accessible online platform.
How to open a traditional IRA with SoFi:
Choose an IRA account type.
Select traditional IRA. Other options include Roth and SEP.
Select how you'd like to invest.
You choose how hands on you want to be with your investments—do it yourself (Active Traditional IRA) or have us do it for you (Automated Traditional IRA).
Open an account.
After you’ve opened your account, add money to your IRA by making a single or recurring deposit from your bank account. You can also rollover your 401(k) to your new account.
Choose your investment approach.
Automated traditional IRA:
A hands-off approach.
Overwhelmed by your investment options or not sure where to start? We're here to help. Just tell us about your overall retirement and investment goals and our robo-advisor will build and manage a custom portfolio for your traditional IRA - just for you.
Active traditional IRA:
Do it yourself.
If you want to be hands-on and select your own investments in your traditional IRA, active investing is the option for you. Be your own investor and pay no commissions on your trades.
FAQs
• If you withdraw earnings before age 59 ½, you’ll pay a 10% penalty plus taxes.
• Contribution limits may be lower than other retirement plan options, such as an employer-sponsored 401(k).
• Once you hit age 73, you’re required to take required minimum distributions (RMDs).
• Unlike a 401(k), you can’t borrow against an individual retirement account.
Prepare for your retirement
with a SoFi Traditional IRA.
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