5 Retirement Accounts You Don't Need a Ton of Money to Open

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When I graduated from school and started working, my parents and friends told me repeatedly how important it was to start saving for retirement. But when I looked into opening an account, most institutions required $1,000 or more to get started. I didn't have that much money to set aside, and it seemed so overwhelming. So I didn't open an account until years later.

I'm kicking myself for it. The earlier you start saving for retirement, the more compound interest it builds and the less you need to invest to retire comfortably. I missed out on years of interest because I was too intimidated by account minimums, and didn't think of alternatives. (See also: 10 Signs You Aren't Saving Enough for Retirement)

Instead of making my same mistakes, you can start saving for retirement today by opening a Roth IRA. Below, find out why Roth IRAs are such a useful option and where you can open one without a lot of startup cash. (See also: 4 Reasons Why a Roth IRA May be Better Than Your 401(k))

What is a Roth IRA?

If you're just starting out, don't have access to a 401(k), or want to supplement your retirement nest egg, a Roth IRA is a fantastic savings vehicle.

Unlike a 401(k), where you make your retirement contributions with pretax dollars, with a Roth you contribute your after-tax income. While that means you don't get an upfront tax break, you won't owe money on account withdrawals once you retire. You already paid taxes, so you can take out the money free and clear.

A Roth IRA is a perfect tool for young people just starting out. Because your contributions are made after taxes, you can take out the principal from the Roth IRA in the case of an emergency without owing any penalties or fees. While you should never touch your retirement savings except in the most dire of circumstances, having money in a Roth IRA can give you additional peace of mind. (See also: Using Your Roth IRA as an Emergency Fund — Ever a Good Idea?)

Roth IRAs with low minimums

While many institutions require a minimum investment of $1,000 or more to open an account, there are several reputable firms where you can open a Roth IRA without a minimum investment.

1. TD Ameritrade

TD Ameritrade does not charge any setup, low-balance, or annual fees for Roth IRAs, and they do not have a minimum startup investment. You can open an account with just a few dollars. There are commission and brokerage fees, but TD AmeriTrade's fees are low compared to other big-name banks and brokerage firms.

2. Capital One

Capital One is one of the oldest online brokerage firms around, and they offer low fees and automatic contribution and investment options. There are no minimums to open a Roth IRA and they do not charge inactivity fees, but you do need to be a Capital One 360 customer. If you have a checking or savings account with Capital One, you can sync your account so you can view them all at once and make contributions or withdrawals between them.

3. Scottrade

With Scottrade, you can open a Roth IRA with no minimum investment, zero account maintenance fees, and trades for as little as $7 each. You can invest in stocks, bonds, mutual funds, and exchange-traded funds (ETFs).

4. Merrill Edge

Merrill Edge offers Roth IRAs with no minimum investment. Ranked #1 in Kiplinger's Best Online Brokers list in 2016, the company charges just $6.95 a trade. And right now, they're offering up to $600 in cash bonuses to new investors who open an account.

5. Betterment

If you are a hands-off investor and would like help choosing and managing your investments, Betterment may be for you. It's a robo-adviser company that assesses your financial situation, goals, and risk tolerance and calculates an investing strategy for you. There is no account minimum, and the management fee ranges from $4/month for investing balances under $20,000 to 0.25% for balances over $20,000.

See also: Should You Trust Your Money With These 4 Popular Financial Robo-Advisers?

Start investing

If you've been putting off opening up a retirement account because you thought you didn't have enough money, know that there are plenty of options, and a Roth IRA is a great place to start. Opening an account and starting the saving habit now — even just a little at a time — will pay off over the long-term.

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