Key takeaways

• You can open multiple IRAs — including more than one Roth IRA — but total annual contributions are capped at $7,500 for individuals under age 50 and $8,600 for those age 50 or older (2026).
• Having both traditional and Roth IRAs can help you balance potential tax deductions now with potential tax-free withdrawals later.
• Having multiple IRAs may support investment and estate diversification but could result in added fees and administrative complexity.

You can have multiple IRAs, but contribution limits apply across all. Use them strategically for tax and investment diversification.

When you’re ready to open a retirement account, an individual retirement account (IRA) is one of numerous options available to you. It offers tax advantages as well as flexible withdrawals. In many cases, your retirement savings strategy might involve multiple accounts. It’s important to know that while you can open more than one account — including more than one Roth IRA — you’ll still be subject to strict contribution limits.

Keep reading to learn how IRAs work, the pros and cons of opening more than one IRA, and how to choose the right IRA strategy for your situation.

The basics of IRAs

An IRA — short for individual retirement account — is a type of tax-advantaged retirement account. It differs from other popular retirement accounts like the 401(k) in that it isn’t generally offered through an employer. Instead, it’s a self-directed account that you open directly with an investment firm or another provider.

IRAs can serve as a complement to workplace retirement plans. The additional account allows you to contribute more toward retirement. Additionally, IRAs can offer different options for the investor when it comes to investment selection, fees, and more.

In 2026, taxpayers can contribute up to $7,500 of their earned income to an IRA, up from $7,000 in 2025. Investors age 50 or older can save a total of $8,600 in 2026, up from $8,000 in 2025. You can contribute to an IRA for the 2025 tax year until April 15, 2026.¹

There are two primary types of IRAs: traditional IRAs and Roth IRAs. The key difference between the two is their tax advantages, though they also differ in their withdrawal rules.

Traditional IRAs

A traditional IRA is a pre-tax account, meaning you may be eligible to deduct your contributions.  Depending on certain factors including your income, you may get an upfront tax benefit by reducing your taxable income by the amount you’ve contributed to your IRA. Any investment growth is tax-deferred; you won’t pay taxes on it until you withdraw it during retirement, at which point you’ll pay income tax at your ordinary rate.

The money in your traditional IRA is intended to remain there until you reach age 59 ½ or meet one of several other requirements. Any distributions before then may be subject to a 10% early withdrawal penalty, along with ordinary income taxes.

Eligibility requirements

Anyone with earned income can contribute to a traditional IRA. If you are also covered by an employer-sponsored retirement plan, you can only deduct your traditional IRA contributions, if your income is under a certain threshold.

For tax year 2026, you can deduct your full contribution if you’re a single taxpayer with a MAGI of less than $81,000 ($79,000 in 2025) or a married filing jointly taxpayer with a MAGI of less than $129,000 ($126,000 in 2025). After that, your allowable deduction starts to phase out. And you’ll be disqualified from deducting your contributions altogether once your MAGI reaches $91,000 ($89,000 in 2025) if you’re a single taxpayer and $149,000 ($146,000 in 2025) if you’re a married taxpayer filing jointly.¹

Roth IRAs

A Roth IRA has the opposite tax advantage of traditional IRAs. There’s no upfront tax benefit since you can’t deduct your contributions. However, your investments in the account offer tax-free growth potential, and you won’t pay income taxes on your qualified withdrawals.

Read more: What is a Roth IRA?

Roth IRA earnings are tax-free only if the withdrawal is “qualified” (age 59½ + five-year rule). Roth payouts come first from contributions (tax/penalty-free), then conversions, then earnings. Any withdrawals before age 59 ½ that don’t meet certain exceptions will be subject to the 10% early withdrawal penalty. They’ll also be subject to income taxes, which wouldn’t be the case if the distribution had met the IRS’ qualified distribution criteria.

One key advantage of the Roth IRA is that while your earnings are subject to certain withdrawal rules, your contributions aren’t. Because your contributions were made with after-tax dollars, you can withdraw them tax-free and penalty-free at any time.

Eligibility requirements

You can only contribute to a Roth IRA if your modified adjusted income (MAGI) falls below a certain limit. If your MAGI is below $153,000 ($150,000 in 2025) for a single taxpayer or $242,000 ($236,000 in 2025) for a married taxpayer filing jointly, you may contribute the full amount to your Roth IRA in 2026. After that, your allowable contributions begin to phase out.²

Once your MAGI reaches a certain threshold, you can’t contribute to your Roth IRA at all. In 2026, the maximum MAGI for any contributions is $168,000 for single filers ($165,000 in 2025) and $252,000 ($246,000 in 2025) for married taxpayers filing jointly.

Read more: Roth IRA 2025 and 2026 contribution limits

How many IRAs can you have?

There’s no limit on the number of IRAs you can have, nor on the combination of IRAs you can have. For example, you could decide to have two IRAs, both of them Roth IRAs. On the other hand, you could choose to have two IRAs, but one is a traditional IRA while the other is a Roth IRA.

There are a few different reasons someone might have more than one IRA, including tax diversification and investment diversification. However, more IRA accounts don’t equal higher contribution limits — the annual contribution limit applies across all accounts.

The contribution limit for IRAs in 2026 is $7,500 for those under age 50. That limit applies to all of your IRAs combined. You can’t contribute $7,500 to each IRA.

For example, suppose you have a traditional IRA and a Roth IRA. With a maximum contribution limit of $7,500, you could do one of the following:

1. Contribute $7,500 to your traditional IRA and $0 to your Roth IRA
2. Contribute $0 to your traditional IRA and $7,500 to your Roth IRA
3. Contribute some money to your traditional IRA and some to your Roth IRA, for a total combined contribution of $7,500

Pros of having multiple IRAs

Tax diversification

One of the biggest reasons someone might decide to have more than one IRA is to diversify their tax advantages. As we’ve discussed, traditional IRAs offer an upfront tax benefit, while Roth IRAs offer a tax benefit during retirement.

Rather than choosing one tax benefit or the other, many people choose to optimize their tax situation by taking advantage of both tax benefits. They contribute some money to their traditional IRA, which may allow them to lower their current taxable income if they meet IRS deduction eligibility rules. They also contribute some to their Roth IRA, which allows them to receive tax-free withdrawals during retirement.

Beneficiary designations and estate planning

Having more than one IRA can be a tool for estate planning in a couple of different ways. First, if you have more than one IRA, you could simply add one beneficiary to each account. If you have two children and two IRAs, they will each inherit one when you pass away.

Another benefit of multiple IRAs during estate planning is tax diversification. Traditional IRAs are subject to required minimum distributions (RMDs) when you turn 73.³ As a result, you may have less tax-deferred money left to pass down to your beneficiaries. However, Roth IRAs aren’t subject to RMDs during the original account holder’s lifetime, meaning you can let the money stay invested indefinitely.

Finally, having multiple IRAs to pass on to your beneficiaries can help your loved ones manage their tax liabilities. When someone inherits a traditional IRA, they must pay income taxes on their withdrawals, just as you would on your own account. However, Roth IRA withdrawals aren’t taxable to beneficiaries.

Investment diversification

Having multiple IRAs can make it easier to diversify your investment portfolio, especially if you choose significantly different investment strategies for each IRA. Suppose you want the majority of your portfolio invested in a moderate-risk portfolio that combines stocks and bonds. You may decide to invest that entire IRA balance in a target-date fund or a similarly diversified fund.

However, you may also want some money set aside to invest in higher-risk investments, such as individual stocks or growth funds. Your entire second IRA could be devoted entirely to that purpose.

Flexibility on withdrawals

As we’ve mentioned, traditional IRAs and Roth IRAs have different withdrawal rules. Traditional IRAs contributions and earnings and Roth IRA earnings must stay in your account until you reach 59 ½ or you’ll likely pay a 10% early withdrawal penalty, plus income tax where applicable. However, Roth IRA contributions are made with after-tax money and can be withdrawn tax- and penalty-free at any time.

Therefore, you might decide to contribute to both types of accounts to create more flexible withdrawals. The money in your traditional IRA will remain there until you reach 59 ½, as will your Roth IRA earnings. Your Roth contributions, on the other hand, are there if you need emergency cash or if you decide to retire early.

Read more: Roth vs traditional IRA: Which should I choose?

Brokerage IRA insurance coverage

Holdings in an IRA with a brokerage firm may be covered by the Securities Investor Protection Corporation (SIPC) which provides limited protection if your SIPC-member brokerage firm goes out of business, but not market losses. However, this insurance maxes out at $500,000 (only $250,000 of which can be cash).⁴

Having multiple brokerage IRAs at different brokerage firms gives you added protection from the SIPC. If your IRA balance exceeds the $500,000 limit, you may feel more peace of mind dividing that money up among multiple accounts where it can all be insured.

Backdoor Roth IRA

If you want to contribute to a Roth IRA but your MAGI is too high, having multiple IRAs can help you set up a backdoor Roth IRA. This strategy allows you to contribute to a Roth IRA by going in through the back door, so to speak.

The first step of a backdoor Roth IRA is making a non-deductible contribution to a traditional IRA. Then, before you invest the contributions in anything, you make a Roth conversion from your traditional IRA to your Roth IRA. Because you haven’t deducted your traditional IRA contributions, there’s no immediate income tax due from converting it to a Roth IRA.

Cons of having multiple IRAs

Increased administrative complexity

The more IRAs you have, the more accounts you have to manage. While IRAs don’t require much administrative work once they’re set up, there is still some paperwork involved, especially if you’re making deductible traditional IRA contributions.

If your goal is to simplify your finances, having more than one IRA may do the opposite. In that case, you may be better off with just one IRA, choosing between a traditional and a Roth.

Potential for higher fees

Some IRA providers charge monthly or annual fees to maintain an account. If your provider charges a percentage-based fee, then having more than one IRA won’t necessarily make a difference. However, if your provider charges a flat fee, then multiple IRAs could increase your costs.

Potential for overlapping investments

You may think you’ve sufficiently diversified your IRA investments, but that may not necessarily be the case, especially if you’ve invested in mutual funds or exchange-traded funds (ETFs). Large funds often include hundreds — or even thousands — of securities, and they tend to overlap significantly.

For example, suppose you’ve invested one of your IRAs in an S&P 500 index fund and the other in a total stock market index fund. Yes, they’re two entirely different funds that represent different portions of the market. However, because total stock market funds are weighted, about 80% of their contents are the S&P 500.⁵ So, while you thought you were diversifying your portfolio by investing in two different funds, most of your investments may overlap entirely.

Complex retirement planning and portfolio management

Having two or more IRAs means having two different portfolios to manage. Of course, this doesn’t necessarily have to be complicated. You could have one traditional IRA and one Roth IRA and invest them both in the same target-date fund.

However, if you choose not to invest your IRAs in the same investments, then you’ll have to work twice as hard to decide on your asset allocations. And depending on your investment selections, you may have twice as much monitoring and rebalancing to do throughout the year.

Choosing the right IRA strategy

Factors to consider when deciding whether to have multiple IRAs

The first step of setting up multiple IRAs is deciding whether that’s the right choice for you in the first place. Here are a few things to consider when deciding if multiple IRAs are right for you:

• Eligibility: First, remember that not everyone is eligible to contribute to a Roth IRA, just like not everyone is eligible to deduct contributions to a traditional IRA due to IRS income phaseouts. It’s important to research upfront whether you’re eligible for either of these accounts.
• Individual financial goals: Each person’s financial picture looks different. It’s important to take a holistic look at your personal finances and consider your financial needs. One person may decide that one IRA is plenty, while another might want two or more.
• Tax considerations: We’ve already talked about the tax benefits and consequences of each type of IRA. It’s up to you to decide which tax advantage — or which combination of tax advantages — is best for your situation and goals.
• Estate planning objectives: There are quite a few estate planning considerations involved with multiple IRAs, including beneficiaries, tax advantages, and RMDs. While these may not be a factor in your decision, it’s important to at least consider them.

Read more: 5 IRA benefits for retirement planning

Strategies for optimizing multiple IRAs

If you’ve decided that multiple IRAs are right for you, it’s important to take steps to optimize them. There are several different ways to use multiple IRAs to your advantage, including combining different tax advantages, creating increased portfolio diversification, and more.

The key to optimizing multiple IRAs is knowing why you want more than one. Once you know your objective of having multiple IRAs, you can set up your contributions, investments, and withdrawals in a way that best suits your personal finances and goals.

Read more: The advantages of an IRA

The bottom line

An IRA can be a key part of your retirement savings strategy. And the good news is there’s no limit to the number of IRAs you can have, meaning you can combine the tax treatments of both a traditional and Roth IRA, or even open more than one of the same type of account.

There are several benefits to having more than one IRA. However, there are also a few downsides. It’s important to consider whether having multiple IRAs is right for you and, if it is, how you can optimize your strategy to make the most of those accounts.ost of those accounts.