UnThreaded | Threaded | Whole Thread (22) | Ignore Thread Prev | Next
Author: borngiantsfan Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75642  
Subject: Starting IRAs for Children Date: 10/19/2011 7:31 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 0
I am thinking of starting my 18 year old children with a small IRA. They both are in college and have part time jobs earning about $3k per year. They also both have small investment accounts that we started with about $3500 each in them.

So I was thinking of starting them off with a small IRA (about $500 per year) to get their retirement planning going early. I am considering going with a Roth IRA mainly because:
- their income level is so low, there is no tax benefit with a Traditional IRA
- The Roth is tax free at withdrawal time, when they will likely have a higher tax liability
- Funds can be withdrawn from a Roth IRA for home purchase if needed
- The ROTH IRA is more flexible than a traditional IRA in many other ways.

Any thoughts or comments on this?

It seems like a way to get them going towards a retirement plan, without easy access to the money (as in the investment account) except for a home purchase. In other words they can't simply pull the money out and buy a something :).


Thanks
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (22) | Ignore Thread Prev | Next

Announcements

The Retire Early Home Page
Discussion on accelerating retirement day.
Post of the Day:
Apple

Apple and Ninety Years Ago
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement