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I have a primary IRA which I've rolled 401k plans into and contributed to on an annual basis. It is with a full service financial institution and managed with a financial planner.

With the rise in services like Betterment and Personal Capital I've been thinking about investing to see how the experience compares and what the returns are like.

Other than the administrative overhead of managing multiple accounts at different institutions are there any disadvantages to having multiple IRA accounts which I should be concerned with? I understand the maximum contribution is still $5,500 across both of them. Are there tax or other implications I should consider?

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If more than one of them charge account fees, you'll be paying more in fees than you should.

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  • It didn't even occur to me that someone would pay account fees for IRA... Are you still paying these fees?
    – littleadv
    Mar 12, 2015 at 5:21
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    When I worked at Edward Jones, they charged a $30 annual fee. I remember Merrill and Morgan charging them, too. But all the discount brokerages cut the fees long ago. I don't mind paying a reasonable fee for good service. But it has to be exceptional service, and must do more for me than I can do for myself.
    – Kent A.
    Mar 12, 2015 at 5:28
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Not in particular, no. Just more accounts to keep track of, and if you contribute to multiple accounts - you'll need to account properly to make sure the overall limit is not exceeded.

When the RMD time comes, there will be some additional overhead as well, but other than that shouldn't be any issue.

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  • tracking limits are the biggest issue, from my perspective as a retired financial advisor
    – Aaron Hall
    Mar 12, 2015 at 19:02
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I would also say that it might be difficult to properly diversify. Having all your accounts in the same place simplifies the task.

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