Northwestern Mutual IRA Overview
Northwestern Mutual is known for its financial stability and strong customer service. They offer a range of Individual Retirement Account (IRA) options, along with financial planning, insurance, and brokerage services. While their advisers can be helpful for new or less experienced investors, the fee structure and lack of online trading options may not appeal to more seasoned investors.
About Northwestern Mutual
Best known for its insurance products, this Milwaukee-based company is consistently recognized for its financial strength. It holds the highest possible ratings from A.M. Best Company, Fitch Ratings, and Moody’s Investors, and the second highest from Standard and Poor’s.
As a mutual company, Northwestern Mutual is owned by its policyholders rather than shareholders. The company has a nationwide network of advisers to assist clients with retirement and financial planning.
Types of Accounts
Northwestern Mutual offers both Traditional and Roth IRAs. Contributions to Traditional IRAs are tax-deductible, and taxes are paid on withdrawals in retirement. Contributions to a Roth IRA are not tax-deductible, but withdrawals in retirement are typically tax-free. A Northwestern Mutual adviser can help discuss the differences and assist in deciding which type of IRA best meets your objectives.
Northwestern Mutual IRA Fees
The fee structure for a Northwestern Mutual retirement account varies depending on the options chosen by the investor.
Roth and Traditional IRAs at Northwestern Mutual are subject to a $50 annual fee, which can be waived if the client has more than $250,000 in certain Northwestern Mutual accounts.
Northwestern Mutual’s investment commissions are based on a sliding scale. Trades of $1,000 or less incur a $40 fee, while trades over $1,000 are subject to a $50 fee plus a percentage ranging from 1.3% to 0.75%, depending on the trade amount.
Northwestern Mutual also offers a Signature Portfolio program, where they actively manage and rebalance the account for a fee. Investors in this program do not pay per-trade commissions; instead, they pay a quarterly fee based on the portfolio’s value. For example, an investor with $100,000 might pay an annual fee of 1.75%.
Mutual Funds
Northwestern Mutual offers a variety of mutual and exchange-traded funds. Investors can choose from large fund families, including American Funds, Fidelity Investments, and Russell Investment Funds.
Opening An Account and Doing Business With Northwestern Mutual
To open a new account, investors must contact their Northwestern Mutual adviser or reach out to a local Northwestern Mutual office to find an adviser.
Potential clients can also fill out a form on the Northwestern Mutual website to have an adviser contact them.
The adviser plays a key role in how clients do business with Northwestern Mutual. Beyond opening the account, investors must contact their adviser or call Northwestern Mutual’s national service center to complete trades and other account maintenance. Investors who prefer to manage their accounts solely online with minimal interaction may find that Northwestern Mutual is not the best fit for them.
Additionally, Northwestern Mutual advisers offer the full range of the company’s products. Investors should be aware that their adviser will likely discuss insurance options, including whole life insurance.
Online Account Features
Northwestern Mutual’s web interface has improved significantly in recent years. The secure portal uses two-step authentication to protect investors’ information and identity.
The website’s navigation is straightforward and allows investors to easily:
- View account balances and activity.
- Set communication preferences for confirmations, statements, and regulatory documents.
- Monitor portfolio performance.
- View statements, tax documents, and other relevant information.
However, it’s important to note that online trading is not available. Northwestern Mutual requires verbal confirmation to execute a trade.
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Research and Analytical Tools
Northwestern Mutual account holders have access to a variety of research and analytical tools through their online accounts.
In addition to weekly and quarterly market analysis reports, Northwestern Mutual offers a portal with the latest financial news and market performance indicators. The portal also includes a comparison tool that allows investors to do a side-by-side comparison of mutual funds or stocks.
Investors can view and track their portfolio performance through multiple options.
Northwestern Mutual also provides a financial planning and budgeting tool similar to Mint.com. This tool allows investors to link external accounts and track expenses. The most valuable feature is the net worth tracker, which provides a snapshot of the total value of holdings across Northwestern Mutual and other institutions.
Linking external accounts is optional, but doing so allows the Northwestern Mutual adviser to use real-time data to create custom retirement income projections for clients.
Comparison
Northwestern Mutual offers service from a dedicated adviser and excellent research and educational tools. However, some of their products come with higher fees than similar offerings from other brokerage companies.
Northwestern Mutual IRA Recap
If you’re already using other Northwestern Mutual services or prefer a more personalized, concierge-style approach, Northwestern Mutual could be a good fit. However, if you’re looking for better pricing and the ability to self-direct and manage your own accounts, you might find better options with a discount brokerage company.
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Updated on 7/2/2024.
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