The Motley Fool Discussion Boards
Financial Planning / Wealth Creation Strategies
|Subject: Re: Minor IRAs --- does this sound crazy?||Date: 9/29/2005 3:46 PM|
|Author: JAFO31||Number: 35 of 74|
crf01: "Seeing the other message about IRA for children gave me the courage to ask this question."
"I have a 3 year old, 9 month old, and (-7) month (on the way)."
"My first 2 already have savings accounts each with $15k in CDs. Each will have about $500 in interest income this year. This gave me the idea to open Minor IRAs in their names and fund them equivalent to their CD income.
Can I do this?"
Not as written. Each child would need "earned income" to fund an IRA. Except for child models and actors, most 3 year olds and 9 month olds do not have earned income.
We opened an IRA when our daughter was a young teenager with earned income from baby sitting and pet sitting.
"And, does it sound too extreme?"
No, not if done in compliance with the law.
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