Forest Hill's Jeff Judge in Kiplinger: The fee your "zero-fee" IRA never shows you

By Jeff Judge, CFP®, AEP®, ChFC®, CLU®, Managing Partner, Chesapeake Financial Planners, Forest Hill, MD.

Every account provider loves the word "free." A zero-fee IRA sounds like exactly that. It is not. Kiplinger asked me about this recently, and my answer was simple: the account opening is free, but what happens inside it usually is not.

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The cost I see most often with new clients is cash that never gets invested. Money rolls into an IRA from an old 401(k) or a rollover, and it just sits there, sometimes for years, earning almost nothing while the provider quietly keeps the spread. My fix is low-tech: set a calendar reminder for 48 hours after funding the account and actually pick an investment. A target-date fund is a reasonable default if you are not ready to build a full portfolio from scratch.

The second cost runs deeper and compounds for decades. An actively managed fund can charge nearly nine times what a comparable index fund does, and the two can sit on a menu with almost identical names. Read the prospectus, not the landing page.

For families in Fallston and retirees settling into Bel Air, this matters more than it sounds. Nobody opens a "zero-fee" account expecting to lose ground to fees they never see. The same goes for commuters heading into Towson who rolled over a 401(k) years ago and have not looked at it since.

Zero dollars to open an account does not mean zero cost to hold it. Before you assume a "free" IRA is actually free, ask what it costs to hold, not just to open.

This piece builds on "The Hidden Costs Inside a 'Zero-Fee' IRA," in Kiplinger (August 2026).

Jeff Judge, CFP®, AEP®, ChFC®, CLU®, is Managing Partner at Chesapeake Financial Planners in Forest Hill, MD. Book an intro call.