[frgtpsswrdlame]

I think that he's definitely right about consolidation and then acquisition.

I work in HNW wealth management and I think that there needs to be better education on what for example a young person's IRA should look like. An ideal robo-advisor would make buy recommendations, ask you to never sell, and use education along the way to help prevent you from making the same mistakes most people fall trap to. I also think that if any of these companies have a desire to stay around for a while they need to be targetting the IRAs of young, high-income programmers. With a good fee and good education and assistance they can probably retain these customers, encourage them to max out contributions into their IRA (you should!!) and slowly build up a long tail of decent-sized accounts from people that may have only been interested from a tech perspective initially.

[mattzito]

Sorry for the naive question - but if you're contributing to a 401k, aren't you ineligible for tax-deductible contributions to an IRA?

If so, it would seem like an even better business would be getting into administering 401k plans cheaply with employers and then keeping people on the platform post-employment.

[sigstoat]

if you have an employer sponsored retirement plan available to you, then making over a certain amount means that your traditional ira contributions aren't tax deductible. at that point you should make roth ira contributions instead. (until you make so much you can't contribute to a roth at all, at which point you can go back to making non-deductible contributions to a traditional ira.)

https://www.irs.gov/retirement-plans/2017-ira-deduction-limi...

[frgtpsswrdlame]

This, roth's are great. Also if you still have more money after the 401k and roth and you're thinking you may have children/grandchildren 529's are another good tax-advantaged vehicle.

[beisner]

I'm pretty sure that contributing to a 401k doesn't make you ineligible to contribute to an IRA, but making over a certain amount of money annually does.

[MarkPNeyer]

Adding to this:

Not a lawyer etc but I don't think a 401k prevents you from making IRa contributions either. Never heard of that.

As for income limits, you can still contribute to your IRA if your income is above the limit (I think that's 125k or so) but the contributions will no longer be tax deductible.

Once you're past that limit, you may as well convert from regular to Roth IRA (this is called a backdoor conversion) so that your money grows tax free.

[icedchai]

You can contribute, but you won't be able to deduct the contribution if you have a 401K.

This is for a traditional IRA. Roth IRAs aren't deductible, and also have income limitations.