Ask Terry Questions Roth IRA – Young Adult

Roth IRA – Young Adult

By Terry Savage on November 22, 2014 | Financial Planning / Retirement

Hi Terry, my son has a part time job at his school. I would like him to open up ROTH IRA. Can you name a few mutual funds that allow start up investing. Most of the mutual funds want $1,000 to open up a ROTH IRA but I want him to get in the habit of regular monthly investing. Thanks. :0)

Terry Says:   Well,  if you want a low-cost alternative (and if he made at least $1,000), I think you should start him off by contributing $1,000 to open a Vanguard IRA — probably in their S&P 500 fund, or in their equity index fund, or even in the Vanguard Star Fund (which has a combination of their other funds).  Then he can make additional contributions.  Remember, he can contribute up to $5500 of earnings — but it doesn’t have to be HIS money that gets it started.

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