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Age 62 is a long way off for me! (40 years). That is both good and bad for retirement planning. I pay 0 (I think) federal taxes yet budget frugally and can afford between $100 and $250 to savings each month. My current plans are $100 a month to a Roth-IRA. I don't think I want to put more than that, and probably will use that to put a down-payment on my first home (about 7 years away probably).

Once I make more income putting it away in a Roth won't be a problem, but right now I may want to put it away in something a little more liquid. I was thinking maybe just buying into the S+P or some other stock but not use the IRA function. Or put a smaller amount in an IRA (maybe $50 a month). I guess there are a lot of variables that you can't give a "perfect" answer, but basically my concern is putting money away that is currently a large percentage of income to not touch for 40 years versus investing without an IRA while waiting to the start the IRA for a few years when I make more money.

By the way, I am putting money aside for an "emergency fund" as well, so I do have liquidity there...
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Most of us wish we could turn back the clock and be 22 again in order to be able to maxed out our ROTH IRAs while in our twenties....

Saving a lot of money between now and your 30th birthday will likely save you from having to plunk down huge amounts of money during your 40's and 50's in order to have enough money by the time you turn 62.

your choice... 3000 this year or 3000/month for 10 or more years when you turn 50... sounds like a no brainer to me.

I can't wait for my accountant to say that my daughter is 'old enough' to contribute to a ROTH... she's only 5.
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I can't wait for my accountant to say that my daughter is 'old enough' to contribute to a ROTH... she's only 5.

There is no age restriction for contributing to a Roth IRA (it's someone's name, not an acronym). The only requirement is that the IRA owner have earned income (reported to the IRS if necessary).

The only question is how to get your 5-year-old a job legally. There are a few exceptions in the child labor laws.

For instance, parents of child actors can open Roth IRAs for their children and contribute the child's earnings.
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If you think retiring is expensive now, just wait until 40 years go by!

But you're right -- you do need to have some savings that you can get at now. You should have a savings cushion; some people say 2-3 months expenses, others say 6 months income. Put it in a money market or savings account that you're comfortable with.

A Roth IRA still might fit the bill: you can withdraw your contributions at any time. They keep track of the amount you've contributed and the amount you've withdrawn. As long as you don't withdraw more than you contributed, there's no tax or penalty.

What exactly are you worried about? If you're buying stocks now, you should wait for a long time before you sell them, anyway.
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A Roth IRA still might fit the bill: you can withdraw your contributions at any time. They keep track of the amount you've contributed and the amount you've withdrawn. As long as you don't withdraw more than you contributed, there's no tax or penalty.

Ah, I have learned something new. So if there were ever a major emergency I could get it out with no penalty (though if it were that major of an emergency I'd probably take it out with the penalty)

What exactly are you worried about? If you're buying stocks now, you should wait for a long time before you sell them, anyway

For the most part I am hoping I would never need to sell until retirement age. But my biggest fear is illness. I am in remission. I have insurance for now (COBRA) and think I can get on another policy in the future (student insurance) but private insurance is basically impossible. I am saving up money each month in my emergency fund meant to handle my copays in the event I would get sick, but if it would strike tomorrow or something I would probably have well over $100,000 in medical bills. The insurance handles a lot, but "comfort" meds are often very expensive. I have relatives that would gladly help as well, but my pride would handle it better if I at least knew I could handle it.

But thanks for the info. I think that while there may be some mild doubt now, 50 years from now the IRA will be totally worth it!
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