What BMO Harris offers for retirement savings

BMO Harris Bank offers retirement accounts through its brokerage and banking divisions, but the accounts themselves are standard products — IRAs and employer-sponsored plans — rather than unique to BMO Harris. What differs is how BMO Harris structures fees, investment choices, and account management compared to other banks and brokerages.

BMO Harris provides Traditional IRAs, Roth IRAs, SEP IRAs for self-employed people, and straightforward IRAs for small business owners. If you have a workplace retirement plan through an employer that uses BMO Harris, you may have access to a 401(k) or similar plan. The real comparison point is not whether BMO Harris has these accounts — most banks do — but how their costs, investment options, and service model stack up against competitors.

Key Takeaways

  • BMO Harris offers standard retirement account types (Traditional IRA, Roth IRA, SEP IRA, straightforward IRA) that follow IRS rules, not BMO Harris rules.
  • Contribution limits and tax treatment are set by the IRS and are identical across all banks and brokerages.
  • BMO Harris's competitive difference lies in account fees, investment options available within the account, and minimum balance requirements.
  • If your employer uses BMO Harris for payroll or benefits, your 401(k) plan documents will specify what you can invest in and what BMO Harris charges.

IRA contribution limits and tax rules are the same everywhere

Whether you open an IRA at BMO Harris, a credit union, or an online brokerage, the IRS sets the contribution limit and the tax treatment. For 2024, you can contribute up to $7,000 per year to a Traditional or Roth IRA if you are under 50, or $8,000 if you are 50 or older. These limits do not change based on which bank holds the account.

With a Traditional IRA, contributions may be tax-deductible in the year you make them, depending on your income and whether you have access to a workplace retirement plan. With a Roth IRA, contributions are not deductible, but may have access to withdrawals in retirement are tax-free. BMO Harris cannot change these rules — they come from the IRS. What BMO Harris can control is whether they charge you a fee to hold the account, what investments you can buy inside it, and whether they require a minimum balance.

How BMO Harris fees and minimums compare

BMO Harris charges vary by account type and whether you bank with them or use their brokerage division. Some BMO Harris IRAs have no annual maintenance fee if you meet certain conditions — such as maintaining a minimum balance, setting up direct deposit, or keeping other accounts open with the bank. Other institutions charge flat annual fees regardless of balance, while some charge nothing at all.

Minimum balance requirements also differ. Some BMO Harris retirement accounts may require $500 or $1,000 to open, while competitors may have no minimum. If you fall below the minimum, BMO Harris may charge a fee or close the account. Before opening an account, ask BMO Harris directly what the current fee structure is for the specific account type you want, because these terms change and vary by region.

Investment costs inside the account — such as expense ratios on mutual funds or ETFs — are separate from account fees. BMO Harris offers mutual funds and ETFs, and each has its own cost. A low-cost index fund at BMO Harris will have a lower expense ratio than an actively managed fund, just as it would at any other institution.

Employer plans through BMO Harris work differently

If your employer has chosen BMO Harris to administer the 401(k) or similar plan, the rules come from your employer's plan document, not from BMO Harris alone. Your employer decides what investment options are available, what the employer match is (if any), and what fees the plan charges. BMO Harris acts as the administrator and custodian — they hold the money and process transactions — but your employer controls the plan design.

In this case, you cannot shop around for a better BMO Harris rate the way you can with an individual IRA. You use the plan your employer selected. What you can control is how much you contribute (up to the IRS limit of $23,500 in 2024 if you are under 50, or $31,000 if you are 50 or older) and which investments within the plan you choose.

SEP IRA and straightforward IRA for self-employed and small business owners

If you are self-employed or own a small business, BMO Harris offers SEP IRAs and straightforward IRAs. A SEP IRA lets you contribute up to 25% of your net self-employment income, with a maximum of $69,000 in 2024. A straightforward IRA is for businesses with 100 or fewer employees and allows employee deferrals up to $16,000 in 2024, plus employer contributions.

These account types are also standardized by the IRS. BMO Harris's role is to hold the account and process contributions and withdrawals. The contribution limits, tax treatment, and withdrawal rules are identical whether you open a SEP IRA at BMO Harris or elsewhere. The difference is in BMO Harris's fees, investment menu, and customer service.

How to compare BMO Harris to other banks and brokerages

Start by listing what you need: the account type (Traditional IRA, Roth IRA, employer plan, etc.), the amount you plan to invest, and whether you want to invest in individual stocks, mutual funds, ETFs, or a mix. Then contact BMO Harris and ask for the current fee schedule, minimum balance requirements, and list of available investments for that account type.

Do the same with at least two other institutions — a credit union, an online brokerage like Fidelity or Vanguard, or another bank. Write down the annual account fee, any transaction fees, the minimum balance, and the expense ratios of the funds or ETFs you plan to buy. Over 20 or 30 years, a difference of 0.5% in annual fees can add up to thousands of dollars, so the comparison is worth the time.

If you already bank with BMO Harris and they offer a retirement account with no extra fee for account holders, that convenience may outweigh a slightly higher fund expense ratio elsewhere. If you do not bank with them, the convenience factor disappears, and the pure cost comparison becomes more important.

Withdrawal rules and early withdrawal penalties

BMO Harris cannot change the IRS withdrawal rules, but they do enforce them. With a Traditional IRA, you can withdraw money penalty-free starting at age 59½. If you withdraw before that age, you owe a 10% penalty plus income tax on the amount withdrawn, with some exceptions (first-time home purchase, disability, medical expenses, and others). With a Roth IRA, you can withdraw contributions at any time penalty-free, but earnings are subject to the same 10% penalty if you withdraw before 59½ and the account has not been open for five years.

Required Minimum Distributions (RMDs) begin at age 73 for Traditional IRAs. BMO Harris will calculate and notify you of the amount you must withdraw each year, but you are responsible for taking the withdrawal. If you do not, the IRS charges a 25% penalty on the amount you should have withdrawn (reduced to 10% if you correct it within two years). Roth IRAs have no RMD during the account holder's lifetime.

Frequently Asked Questions

Can I move money from a BMO Harris IRA to another bank?

Yes. You can request a direct transfer (called a trustee-to-trustee transfer) from BMO Harris to another bank or brokerage. BMO Harris cannot charge you a fee for this, though some institutions charge a fee on the receiving end. A direct transfer avoids taxes and penalties. You can also withdraw the money yourself and deposit it elsewhere within 60 days, but this is riskier because you have only 60 days and can do this only once per year.

Does BMO Harris offer investment information for retirement accounts?

BMO Harris offers educational resources and may have advisors available, but whether they provide personalized information depends on the account type and your relationship with the bank. Some advisory services charge a fee. Before opening an account, ask whether information is included or what it costs. Do not assume it is free.

What happens to my BMO Harris retirement account if I change jobs?

If you have a 401(k) through an employer that uses BMO Harris, you have options when you leave: roll it into your new employer's plan (if allowed), roll it into an IRA, or leave it with BMO Harris if the balance meets their minimum. Each option has different tax and investment consequences. Contact BMO Harris and your new employer's plan administrator to understand your choices.

Are BMO Harris retirement accounts insured?

IRAs held at BMO Harris Bank are covered by FDIC insurance up to $250,000 per account type per depositor, but only for cash and certain deposits. Investments in stocks, mutual funds, and ETFs are not FDIC-insured. If you hold individual securities, they are protected by SIPC (Securities Investor Protection Corporation) up to $500,000 per account, but this covers theft or fraud, not market losses.

Can I have both a Traditional IRA and a Roth IRA at BMO Harris?

Yes, you can have both, but your total contributions across all Traditional and Roth IRAs cannot exceed the annual limit ($7,000 in 2024 if you are under 50). If you contribute $4,000 to a Traditional IRA, you can contribute only $3,000 to a Roth IRA that year. The limit applies to all your IRAs combined, regardless of which banks hold them.