Robinhood Markets Inc. is nearing the launch of retirement accounts, part of a bid to challenge traditional money managers and stock-trading platforms, according to evidence found inside the company’s iPhone app.
The company – best known for its commission-free trading of stocks and crypto – has begun adding support for traditional IRA and Roth IRA accounts as well as pension retirement accounts. The underlying code inside the beta version of the Robinhood app was updated this week to include multiple references to retirement accounts, according to developer Steve Moser’s findings shared with Bloomberg.
The news helped Robinhood shares trim its losses on Thursday, but the stock fell 7.2% to $13.51 in New York.
The move is a significant step toward competing more directly with traditional brokerages — and one of several new features for Robinhood this year. Other money manager and brokerage platforms, such as Fidelity Investments and Morgan Stanley’s E*Trade, have offered such accounts over the years.
Robinhood CEO Vlad Tenev has previously said that he aims to roll out retirement-account support by the middle of the year, without getting more specific. “Tax-advantaged retirement accounts are on the road map, and teams are already working hard to develop this functionality,” he said during an earnings call in January.
The code indicates that the app will support rolling over and making contributions to IRAs—which are passed on after death, in addition to working with inherited IRA accounts. A spokesperson for Menlo Park, Calif.-based Robinhood declined to comment on the findings.
IRAs, or individual retirement accounts, allow users to invest as much as $6,000 annually to save on taxes. Traditional IRA accounts typically have tax-deductible contributions, with those income not taxed until retirement.
Roth IRA accounts typically use after-tax dollars and do not result in an immediate tax break, but they do allow tax-free withdrawals at retirement. Pension accounts, meanwhile, are provided by some employers – although they have become less prevalent in recent decades.
Earlier this month, Robinhood launched a Cash Card that gives users the ability to receive cash back, bonuses and direct deposits. This feature, along with a mechanism for lending stocks, new options contract features, crypto wallet integration, crypto gifts and extra-change investing, were all revealed in code findings previously reported by Bloomberg.