Robinhood review 2024: IRA match and no-cost trading

Robinhood at a glance

To learn how our star ratings are calculated, read our methodology.

Robinhood is best for beginner and intermediate traders and investors

Robinhood is a practical option for novices and intermediate traders and investors because it makes it incredibly easy to participate in the stock and crypto markets while offering a respectable trading platform for those looking to take more of an active role. Its platform is one of the most user-friendly on the market and the company continues to innovate with new features, including matching IRA contributions and a trading market that’s open 24 hours a day, five days a week.

What we like about Robinhood

Robinhood is one of the most accessible and beginner-friendly trading platforms on the market. It’s easy to get started, easy to use and commission-free. Instant deposits, fractional share trading from just $1 and Robinhood’s 24/5 trading give you quick and broad access to the market. Robinhood’s 24 Hour Market lets you place limit orders to buy whole shares of 43 stocks and ETFs, including names such as Tesla (TSLA), Amazon (AMZN) and Apple (AAPL). Here’s what else we like.

Robinhood Gold

While Robinhood is free to use, it also offers access to an upgraded version of its platform for a $5 monthly fee. Robinhood Gold features include:

• Earn interest on uninvested cash. Earn 4.5% interest on uninvested brokerage (subscription fees apply) cash in your account (0.01% without Robinhood Gold)
• Larger instant deposits. Access instant deposits up to $50,000 (as long as your portfolio is $50,000+).
• Professional market research. Receive extensive stock reports from Morningstar that include company strategy, performance and risk.
• Technical analysis. Access to Level 2 market data from Nasdaq. Gold members also get unlimited access to Morningstar’s premium, in-depth stock research reports for approximately 1,700 stocks.
• Better margin investing rates. Access to lower margin investing rates at 8% (12% without Robinhood Gold).
• 3% IRA match. Get up to 3% in matching IRA contributions.

Robinhood offers a free 30-day trial period of Robinhood Gold. However, if you decide to use margin investing during the trial period, there’s an annual 8% annual interest charge on any amount you borrow over $1,000. Plus, you cannot earn the 4.5% interest if you invest on a margin.

Robinhood Gold

• Earn up to 4.5% APY on uninvested cash (subscription fees apply)
• Get up to a 3% match on all new IRA contributions, IRA transfers and 401(k) rollovers
• Access professional research from top-tier research provider, Morningstar

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Earn interest on your uninvested cash

Any uninvested brokerage cash in your account can earn 0.01% interest with daily compounding (which helps your money grow faster). Upgrade to its premium subscription, Robinhood Gold, bumps this earning power to a rate of 4.5% (subscription fees apply). Robinhood’s network of 12 partner banks means customers get FDIC insurance on cash deposits of up to $2.25 million. Robinhood automatically sweeps uninvested brokerage cash into deposits at its program banks, so there’s no added step to earn interest.

Get an IRA match

Get a 3% IRA match on IRA contributions when you subscribe to Gold, or 1% without Gold. The IRA contribution limit for 2024 is $7,000, meaning Robinhood will contribute up to $210 in matching funds for Gold subscribers, or $70 without Gold. All IRA transfers and 401(k) rollovers earn 1% with or without Gold, and there’s no limit to how much you can get in matching contributions. If you transfer to Robinhood an IRA with $10,000, Robinhood gives you $300, or $100 if you aren’t a Gold subscriber.

Robinhood is the only broker we review that currently offers this incentive year-round.

Complete control and ownership over your crypto

Trade more than two dozen cryptocurrencies with Robinhood, with no commissions and complete control over your assets. Send and receive crypto and sign up for the separate Robinhood Crypto app to access Robinhood’s self-custody wallet where you can store and manage your crypto on the Ethereum, Bitcoin, Dogecoin, Arbitrum, Polygon, Optimism and Base networks.

IPO access

Get access to select IPOs and purchase shares before they enter the public market. Robinhood’s IPO Access lets you buy shares of companies at the IPO price as the stock becomes available to the general public. Here’s how it works:

• Confirm your interest in an IPO and request shares once the underwriter sets the initial price range.
• Robinhood uses a random allocation process to choose which customers are allotted shares. Shares are limited, and you may get the full number of shares you requested, a partial amount or none at all.
• On the IPO date, Robinhood will let you know how many shares you can buy.

Robinhood’s platform is easy to use

In terms of usability, Robinhood is simple and straightforward, with a clean interface that makes it ideal for beginners. That said, Robinhood’s charting and free research tools are subpar, especially compared to the sophisticated financial tools of some newcomer brokers.

Here are some of the tools you can use to trade with on Robinhood:

• Watchlists
• Key statistics, such as market cap, P/E and average volume
• Buy, hold and sell ratings
• Recent earnings results and estimates
• News feed
• A chart with some advanced features
• A chart with some advanced technical indicators, such as volume, moving averages and bollinger bands
• Trading Trends, which shows Robinhood customer, hedge fund and insider trading activity

Upgrading to Robinhood Gold for $5 per month gets you access to Morningstar research and Level 2 Nasdaq market data, though day traders might still find it lackluster. You can add the Level 2 Nasdaq market data, including a depth chart and book in the advanced chart of any given stock. We did notice that Morningstar research wasn’t available for every stock, though.

Where Robinhood falls short

Here’s where we think Robinhood could improve:

Research tools and investment options are limited

While all Robinhood customers have access to analyst ratings on select stocks and a handful of advanced charting features, Robinhood’s charts still lag the capabilities of several other brokers. And its most powerful tools and data are reserved for Robinhood Gold subscribers. What’s more, Robinhood’s lineup of tradable assets, though decent and expanding, isn’t as extensive as what the biggest brokers currently offer.

Can’t change cost basis method manually

Robinhood uses first-in, first-out as its default cost basis method and there’s no option to manually change this ahead of a trade. According to a Robinhood representative, you can contact Robinhood support before the sell order settles to request a specific lot adjustment. Here’s what you need to provide with your request:

• Security identifier
• Closing trade date and price
• Open lot date, price and cost
• Quantity of each specified lot

Again, you need to request a tax lot change before the sell order settles.

Payment for order flow

Robinhood utilizes the controversial practice known as payment for order flow (PFOF). This means that instead of routing customer orders directly to the stock exchange, Robinhood sends them to market makers or trading firms in exchange for a fee. While this practice allows Robinhood to offer commission-free trading to its users, some critics argue that it may result in less favorable execution prices for customers compared to other brokers that do not engage in PFOF.

Robinhood’s fees

Is Robinhood legit?

Yes, Robinhood is a legitimate broker that was founded in 2013. It’s registered with the US Securities and Exchange Commission (SEC) and is a member of the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation (SIPC). Robinhood Crypto is registered with the Financial Crimes Enforcement Network (FinCEN) as a money services business.

Robinhood’s platform is also considered safe and secure. Through its memberships of SEC, FINRA and SIPC, customers are protected up to $500,000 – including up to $250,000 in cash balances – in the event of Robinhood’s insolvency. In addition, customers enrolled in Robinhood’s cash sweep program are provided a total of $2 million in FDIC insurance on uninvested cash through its partner banks.

Any crypto bought on Robinhood is stored in a mix of cold storage and hot storage. While crypto is not covered by either FDIC or SIPC insurance, Robinhood carries a crime insurance policy protecting crypto held by Robinhood against losses from theft and cybersecurity breaches.

Customer experience

Robinhood’s online customer sentiment is mixed, with both positive and negative reviews from users. Positive sentiment often revolves around the platform’s user-friendly interface, commission-free trading and accessibility for beginner investors. Users appreciate the simplicity of the app and the ability to start investing with small amounts of money. However, negative sentiment typically stems from concerns about platform outages during periods of high market volatility and controversies surrounding issues such as payment for order flow and the handling of customer funds. Overall, while many users find Robinhood’s platform convenient and easy to use, others have raised concerns about reliability and transparency.

Robinhood has a rating of 1.09 out of five stars based on over 250 reviews on the Better Business Bureau (BBB) and is not BBB accredited. Over 2,200 complaints have been closed in the past three years. On Trustpilot, Robinhood has a 1.3 out of five stars based on over 3,600 reviews. Sentiment is mostly positive on Reddit.

Compare Robinhood to other platforms

Compare similar platforms by available asset types, trade fees and minimum deposit requirements. Select Go to site to sign up for an account.

Robinhood

★★★★★

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SoFi Invest®

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Tastytrade

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Frequently asked questions

How many Robinhood accounts can I have?

Robinhood now supports multiple accounts per customer, including individual brokerage accounts and IRAs.

Can I keep the IRA match if I withdraw money from my IRA?

Contributions to a Robinhood Retirement account must be held for at least five years to avoid an early IRA match removal fee. This fee is equal to the IRA match amount earned.

When does Robinhood stock market open?

Robinhood offers extended-hours trading, so you can begin trading on Robinhood before normal market hours.

• Pre-market hours: 7 a.m. to 9:30 a.m. ET
• Regular market hours: 9:30 a.m. to 4 p.m. ET
• After hours: 4 p.m. to 8 p.m. ET

Is day trading stocks on Robinhood allowed?

Robinhood customers with margin accounts with balances less than $25,000 are generally limited to no more than three day trades in a five trading day period. If you place your fourth day trade within any five trading day period, you’ll be flagged as a pattern day trader. At this point, you’ll need to have a portfolio value greater than $25,000 at the end of the trading day to continue day trading the next day.

Robinhood notes that pattern day trading restrictions don’t apply to cash accounts..

How does Robinhood make money?

Robinhood makes money in several ways. Its most significant revenue stream is from routing customers’ stock, options and crypto orders to market makers for execution, a practice known as payment for order flow. It also charges margin base rates of 12%, other account fees and monthly subscriptions of $5 to its premium platform Robinhood Gold.

How does Robinhood’s free stock program work?

When you sign up and link your bank account, you’ll earn a cash value between $5 and $200 that can be used to buy fractional shares of any of the 18 available companies in the program. You’ll also qualify for an additional cash reward with each referral of a new eligible customer. Approximately 98% of customers will receive between $5 and $10, while only 1% of customers will receive between $20 and $200.

What is the Robinhood Cash Card?

The Robinhood Cash Card is an FDIC-insured spending account and the newest iteration of Robinhood’s previous cash management account.

Some of the key features of this account include a cashback debit card, no monthly or overdraft fees, weekly bonuses and the function to round up purchases and invest the extra cents into stocks and crypto.

• A cashback debit card
• The ability to round up purchases and invest the extra money into stocks or crypto
• Bonuses of between 10%–100% on weekly round-ups
• A network of 90,000 fee-free ATMs
• Check sending abilities
• Early paychecks
• No monthly fees, overdraft fees or minimum balance requirements
• 24/7 phone support