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My 20 year old is opening a Roth IRA
Old 03-10-2014, 03:01 PM   #1
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My 20 year old is opening a Roth IRA

So happy I found this and a few other websites that focus on retirement planning! I was truly lost until a few months ago when I decided enough was enough and it was time to get serious about taking control of my retirement. I wish I had done it years ago.

Now I am preaching to my two kids about the importance of EARLY retirement planning and especially the importance of compounding interest. And now my older DS, who just turned 20, is going to open his first Roth IRA!

He is in college full time, but is working every break and even on some weekends. He has no debt or student loans to pay off, so why not get a jump on investing in his future retirment? He is opening a Roth through Vanguard - Vanguard Target Retirement 2060 with an expense ratio of 0.18%. It is 90% equities/10% bonds. (2060 seems a long way away!)

Thanks to all you folks on this forum for opening my eyes and for providing your wisdom. Hopefully my DS will be way ahead 46 years from now.
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Old 03-10-2014, 04:29 PM   #2
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That's great! My 22 year old daughter just opened her first ROTH IRA with Vanguard last year. She graduated last June and just closed on her first condo last week. She has been a saver for a very long time.
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Old 03-10-2014, 04:36 PM   #3
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Excellent and thanks for the reminder. My 20 year old daughter also wants to open her first Roth account.

She had her first real job last year and asked me about getting her retirement started.
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Old 03-10-2014, 05:07 PM   #4
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We think a Roth for the kids is as great a way to get them focused on the topic as you can get.
We started matching all dollars put in a Roth as soon as she (an only) had earned income that would qualify. Highly recommend for those who can swing it--some of the best $$$ you can gift, IMHO
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Old 03-12-2014, 01:27 PM   #5
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My 20 year-old has one. My 17 year-old will open one on his 18th birthday in three months. They both have very limited earned-income while going to college. I told them as long as they're in school and doing well and earning a part-time income, I'll match their savings with a Roth contribution. Hopefully they develop sound financial habits at an age well before I did.
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Old 03-12-2014, 03:20 PM   #6
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I let them spend their earnings (pocket cash while at college from a workstudy job), but I opened a Roth for both of my kids with my funds equal to what they earned in the first couple of years of college (which wasn't much, but it's a start).
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Old 03-12-2014, 06:25 PM   #7
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Good start, all. My 22 year old just landed a job with a 401k benefit, so I took a different tack: helped him open a Scottrade acct with seed money. Interesting about the 501k; by default it was opened by the 401k managers with a fund targeting the year 2050 with fees of .5%, the steepest of the options available. I used it as a learning opp on the dangers of management fees.
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