Update 11/5/23: There’s also a 1% brokerage transfer bonus from Robinhood and a 1% IRA and 401k transfer bonus.
Update 10/26/23: At some point they increased the match for Robinhood Gold members who now get a 3% match. Robinhood Gold costs $5/month and comes with various benefits. Others can still get the 1% match.
Original Post 1/13/23:
Robinhood has launched a new product called Robinhood Retirement. They are offering a 1% match with zero commissions or account minimums. At the moment you have to join a waitlist before you are invited to join. This account is now publicly available.
There are some restrictions on the 1% match:
- You do need to keep matched funds in the account for at least five years, otherwise a fee might be charged when the funds are withdrawn.
- Funds must be new to Robinhood
- Match is capped at the annual IRS limits for contributions
View Comments (111)
If I open a Roth IRA and take gold to get 3% match. How long do I need to pay for gold to get the bonus?
Also, can experienced people chime in if the 5 year lock in period to high to get that extra bonus.
Post says that IRA match is capped at IRS contribution limit, but the promo terms say
"Taxes. Robinhood processes and treats the Robinhood Gold Deposit Match as interest earned
by the IRA account for tax reporting purposes. The interest amount is based on a percentage of
contributions made into the IRA Account. The interest earned by the IRA account will not be
subject to, or impact, the maximum annual dollar contribution limit or the maximum annual
deductible amount"
As I Have seen transferring for a 1% bonus for a five-year lock-in period is bad. But is it worth now to open for the 3% new contribution offer? (130$ = 190$ - 60$) seems like a good bonus.
Why do you say it is bad? is there a cap? 1% can still be a big number specially if you want to roll over 401k/IRA?
Yes.
I've been doing IRA transfer bonuses at all the main brokerages for the past several years. Usually, it's at a tier that works out to ~0.5% with a holding period between 6 to 12 months.
While a 1% match is very much ahead of the competition, the opportunity cost of all the 0.5% bonuses I'd miss out on over the next 5 years makes this a pass for me.
@guest_1725996 I'm not familiar with IRA transfer bonuses at other brokerages, thought it usually had to be just normal brokerage, or if not a high amount. That's a reason I'm considering this one since I don't have as much in my accounts.
Can you suggest a couple IRA transfer bonuses to look out for?
@guest_1731717 Most of the large brokerages accept IRAs for their promotions, so I don't find it too hard to find them. 2023 to date, I've done Merrill Edge, Citibank, Etrade, Fidelity, and Wells Fargo (this last one one is higher balance), all with a Roth IRA.
The year before was Etrade (again), Merrill Edge (again), TD Ameritrade, and Tradestation (doubt they'll do many bonuses going forward).
The smaller Fidelity one is still ongoing if you were looking for a smaller one:
https://www.doctorofcredit.com/fidelity-100-ira-bonus/
Any reason you havent tried Charles Schwab yet?
Also any downside to doing this churning? Is it better to put it in a roll over Roth IRA when you keep churning?
How about Sofi?
This is so helpful, I’ve done about 2 transfers but never thought of churning as I do with checking, I’ll give it a try, had a bad experience with m1 finance I transferred 2 accounts to fidelity, one of ‘em for about 3k and the other 23k, fidelity claimed I didn’t met the req of 25k to get 200$ even though I did transfer more than 25 just not for the same account, I I had to speak to a manager to get a 100$ basically to not get me angry and keep me as costumer since I told him the only reason I transferred was for the 200$ offer and I had to send him Reddit posts with replies from fidelity themselves about not enforcing the 25k but they changed the terms a few days before I applied which sounds like bs to me lol, m1 in the other hand charged 100$ for each account since they closed both even though I never asked them to close it, they do this when ppl transfer in order to get that 100$ fee.
Yeah I've done the fidelity one a bunch of times, tho that's for opening a new account. I guess I never felt the others were worth it with the lower amounts I have in my accounts but maybe it really is worth it since it didn't occur to me I can get a couple done in a year.
Thanks for the write up I will take another look at these!
Current terms of the IRA match does not have the annual contribution limit cap, but also applicable for rollovers, it's an unlimited 1% (or 3% with RH Gold) match now.
Rollovers/transfers are 1%, even with RH Gold. The 3% with RH Gold remains for contributions (i.e. cash deposits up to the annual limit) only.
"The IRA match is an extra 3% match on annual contributions with Robinhood Gold or 1% without. All IRA transfers and 401(k) rollovers earn 1%. It’s not counted toward your annual contribution limits, and there’s no limit on the match amount you can earn.
Previously, you got matched on every external dollar you contributed. Now, you get matched on any amount from contributions, IRA transfers, or old 401(k)s. We’ll add 1%. No cap."
3% on transfer with RH Gold, even with a 5-year holding period, would be great, but they're not offering that unfortunately.
Be mindful of what type of security you're trying to transfer in. I created a Roth IRA with the intention to transfer my Vanguard with VTSAX and other mutual funds and turns out they can't transfer that in. So I went through the creation of the IRA ROTH account for nothing.
From their FAQ:
What can I transfer into Robinhood?
Transferable assets:
Stocks
ETFs
Options contracts (not expiring within 7 days)
Cash balances
Margin balances (if you have a margin-enabled Robinhood account)
Non-transferable assets:
Fractional shares
Crypto
Options contracts expiring within 7 days
Unsupported options strategies
Mutual funds
Bonds
Futures
Annuities
Other assets that haven't been identified as transferable assets
https://robinhood.com/us/en/support/articles/transferring-your-assets-into-robinhood/?region=US
Idea: it is possible with Vanguard to exchange the VTSAX to VTI. That would then be transferable to RH.
Can't you exchange your mutual funds for their ETF equivalents? VTI, etc..
If available by then, the best move would be to wait until 1/1/24 and fund both 2023 + 2024 at once, get your 3% matching ($390), pay for the 1 year of gold as required ($60), and come out $330 ahead. And then just wait 4 more years before you're able to transfer it out :)
Why wait? if we do now for 2023, we will get $195 (3% match with gold). If a promotion exists in 2024, when we make a contribution for 2024, we will again get $195 (3% match with gold). Or is it match work only once per customer? If we wait till 2024 and the promotion expires, we will not get $195 as well. Sorry if I am missing something.
following
Finally signed up for this after much deliberation. If you maximize your IRA contributions (6,500) every year, You come out (135$ = 195$ - 60$). I am sure, they won't go back and take away the existing match, but there is a real possibility to stop matching after a year or two. At that point, we can stop contributing, and take away the money after five years to keep the existing match.
Their ACAT transfer fee is $100 so you need to do this for two years to break even. Total holding period of 6 years.
Can you detail how the free money part works?
Also, five years is an eternity to dangle a clawback threat.
If you contribute the $6500 for 2023 you get $195 from Robinhood as interest (no tax). But you also have to leave it there for 5 years and maintain RH gold for a year after the match. If you can invest in the same fund you were gonna do elsewhere and had gold anyway it might end up being a good deal.
Two major downsides:
1. Robinhood IRA doesn't support options (yet?)
2. RH gold is $60/year. When RH margin rate was 2.5% I thought it was a pretty good deal but it's now more in line with other brokers and the other benefits are not that special (cash interest at ~5% and instant deposit).
they can increase the price of gold at any time, no?
Ah, thanks. The cap makes it not worth the effort for me. If it was uncapped that would obviously be an insanely good deal
Robinhood IRA does support options! But with any IRA, you can only do covered calls and cash-secured puts.
If you transfer 100k, you get 1k? That’s pretty good, no?
Read: "Match is capped at the annual IRS limits for contributions"
But what if we have 100K over the years and move it from another brokerage?
More specifically,
> How much match do IRA transfers and 401(k) rollovers earn?
> An uncapped 1%, including Gold subscribers. For example, as a Gold customer, if you transfer $1,000 from an outside IRA account, you’ll earn a $10 match.
So only limited contributions are 3%, not worth the cost of Gold.