D o you know what your income tax rate will be in the future?

The answer to that question is key to your retirement planning. If you think your tax rate will be lower in the future then it makes sense to avoid paying tax now through a tax-deferred investment vehicle like a Traditional IRA.

But with a mounting national debt, many people believe personal income tax rates will eventually be forced to increase.

Even if the national debt somehow gets taken care of, the government doesnt tend to lower a tax once it is set.

If tax rates are going to go up the best retirement account for you to open if you qualify is a Roth IRA .

You will pay income tax today and never pay income tax on your nest egg again.

Where to Open a Roth IRA

Once youve made the decision to open a Roth IRA there are a number of companies that are happy to accept your contributions. The number of options you have can be overwhelming: do you go with a discount broker, a full-service broker, or direct to a mutual fund company?

Were here to help you cut through the confusion to find the best company to open a Roth IRA with. (Just getting started investing? Check out our Best Online Brokers for Beginners .)

Best Brokers for Roth IRAs:

There is no lack of discount brokerage firms that will let you open a Roth IRA with them. For most investors the number of mutual funds or crazy ETFs you have access to really doesnt matter. A basic portfolio can be constructed with any of the discount brokerage firms. This makes the main point of emphasis fees and transaction costs.

Scottrade

Scottrade is an online and brick-and-mortar discount brokerage firm, which is one of the reasons why I like it so much.

Not only do you get inexpensive trading costs, but if you ever want to sit down with a live human being you can at one of Scottrades 500+ branches around the country.

The firm has kept their trade costs steady at $7 per stock and ETF trade for years. Mutual fund trades vary based on the type of fund with a maximum trade commission of $17.

I like Scottrade so much I even created an account there myself with a video that takes you step-by-step through the account opening process with Scottrade: Opening a No Fee Roth IRA with Scottrade .

• Account Set Up Fees for Roth IRA:  None
• Account Maintenance Fees for Roth IRA: None
• Minimum Deposit to Open Account: $500
• Commissions on Stocks, ETFs, and Mutual Funds:  $7 per stock or ETF trade, maximum of $17 per mutual fund trade

Open an Account with Scottrade and enjoy low trading costs on stocks, ETFs, and mutual funds.

E*TRADE

E*TRADE is one of the bellwethers of the online discount brokerage industry.

The company has been around since 1992 and has constantly been pushing the industry to better technologies and other trading innovations for customers.

Technically E*TRADE does have brick-and-mortar locations for you to go to, but there are only 30 in the entire country. E*TRADE is primarily an online discount brokerage firm, and they are one of the leaders in the industry . Their trade fees are just slightly higher than Scottrade, but there is no minimum deposit required to get started.

• Account Set Up Fees for Roth IRA:  None
• Account Maintenance Fees for Roth IRA:  None
• Minimum Deposit to Open Account:  $0
• Commissions on Stocks, ETFs, and Mutual Funds:  $9.99 per stock or ETF trade, maximum of $19.99 per mutual fund trade

Open an account with E*TRADE and trade free for 60 days, plus get up to $600 in bonuses for opening an account.

TD Ameritrade

Another brokerage firm that mixes online discount trades with brick-and-mortar locations, TD Ameritrade is a great choice.

They have over 125 locations around the country that you can walk into whenever you have a question you want answered in person.

Trade costs are competitive on the stock and ETF side, but look out for the mutual fund charge of $49.99 per trade. (I love everything else about TD Ameritrade except the $49.99 no-load mutual fund commission. That is simply too high.)

If you are going to build an ETF portfolio I can still recommend the company as a solid option thanks to the competitive commissions on ETF and stock trades as well as the option for in-person help.

• Account Set Up Fees for Roth IRA: None
• Account Maintenance Fees for Roth IRA: None
• Minimum Deposit to Open Account: $0
• Commissions on Stocks, ETFs, and Mutual Funds: $9.99 per stock or ETF trade, maximum of $49.99  per mutual fund trade

Open an account with TD Ameritrade and trade free for 60 days, plus get up to $600 in bonuses for opening an account.

ShareBuilder

ING Direct has been purchased by Capital One, and that includes ShareBuilder . The company has a different spin on investing in that it wants to help beginning investors build up the habit of investing. Experienced investors can open accounts, too, because the costs are very competitive.

Trades range from $7.99 (if you pay a $12/month subscription) to $9.99 (for ShareBuilder Basic accounts) and mutual fund transactions are either $19.95 per trade or $4 per automatic investment. The $4 automatic investing charge also applies to stock and ETF trades, too, as long as you set up a consistent schedule of automatically investing in that specific investment.

• Account Set Up Fees for Roth IRA:  None
• Account Maintenance Fees for Roth IRA:  None
• Minimum Deposit to Open Account:  $0
• Commissions on Stocks, ETFs, and Mutual Funds:  $4 per stock/ETF/mutual fund trade if using automatic investment; $7.99 per stock or ETF trade with $12 monthly subscription to ShareBuilder Advantage; $9.99 per stock or ETF trade for ShareBuilder Basic accounts, and $19.95 per mutual fund trade

Open an account with Sharebuilder and enjoy some of the lowest trading commissions available if you sign up for automatic investment.

OptionsHouse

Options House is another great broker in the Roth IRA space. Dont let the name deceive you: OptionsHouse does give you the ability to trade options, but it isnt an options-only broker.

They have incredibly inexpensive trades at $3.95 per stock or ETF trade. Mutual funds are priced well in comparison to the market at $9.95 per trade.

• Account Set Up Fees for Roth IRA:  None
• Account Maintenance Fees for Roth IRA:  None
• Minimum Deposit to Open Account:  $1,000
• Commissions on Stocks, ETFs, and Mutual Funds:  $3.95 per stock or ETF trade, $9.95 per mutual fund trade

Open an account with OptionsHouse  and enjoy rock bottom trade costs plus up to $125 reimbursed for transfer fees from your old broker.

Trade King

TradeKing has absolutely the lowest stock trade commissions around at just $4.95. If you are looking to trade a lot within your Roth IRA, look no further. Mutual fund commissions are extremely low as well at just $9.95 per no load mutual fund trade.

TradeKing recently merged with Zecco, another low cost online discount brokerage firm. The combined power of the two smaller firms helps it compete with some of the bigger firms listed here, and their pricing is extremely attractive.

• Account Set Up Fees for Roth IRA:  None
• Account Maintenance Fees for Roth IRA:  $50 for accounts with no activity within 12 months that also have a balance of less than $2,500, otherwise $0
• Minimum Deposit to Open Account:  $0
• Commissions on Stocks, ETFs, and Mutual Funds:  $4.95 per stock or ETF trade, maximum of $9.95 per mutual fund trade

Open an account with TradeKing and enjoy rock bottom trade costs plus up to $150 reimbursed for transfer fees from your old broker.

Charles Schwab

Charles Schwab is an interesting company that is really a full-service brokerage that is trying to play in the discount brokerage space. For stock and ETF trades, it does this well with an $8.95 commission on those trades.

But if you though TD Ameritrades $49.99 mutual fund commission was high Schwab charges $76 . That is unbelievable. Only open a Roth IRA with Schwab if you plan to build a portfolio of ETFs, not mutual funds.

• Account Set Up Fees for Roth IRA:  None
• Account Maintenance Fees for Roth IRA:  None
• Minimum Deposit to Open Account:  $1,000
• Commissions on Stocks, ETFs, and Mutual Funds:  $8.95 per stock or ETF trade, maximum of $76 per mutual fund trade