Relating to Roth Ira varying investments

[Guest JGerman268]

If you have a Roth IRA with one custodian and you want to invest the next year in something else with an entirely different custodian because the first is with one fund and you want to invest the second year in another fund or stock with a different custodian, is that acceptable?

[John G]

You may have multiple Roths or IRAs. As far as I know, there are no limits at all, no IRS rules on the numbers of IRAs.

However, you must qualify each year to open or contribute to an IRA or ROTH. You can't double count the $3,000 (now $4,000) by having multiple accounts. All contributions to one year are summed, regardless of how many accounts.

Examples: Like your suggestion, each year you can send your contributions to a new custodian and open another account. But, you can also split the $4,000 for the current year into two, three, four or more pieces with each going to a different custodian.

Clearly, there are practical limitations on the number of custodians and funds which are related to annual fees, tracking, your time, etc. Remember, many brokerages give you access to a wide range of mutual funds, so you might be better off with funds at a brokerage in one IRA/Roth but with investments in different funds.