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Roth IRA for a college student?

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Just looking to get some advice. I have read up on the Roth IRA's for a bit of time and I am thinking of opening one up, but I was wondering if it was a smart idea, I see that places like fideilty make you deposit $200 a month to keep it, what happens if I do not have $200 for a month?

 

Also is it smart to open one now as I am a server not going to be able to max it out until I graduate and start my career, is it worth it putting a small amount in now just to get it started?

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Depends, it's after taxes and it's not an employer match.. Money might have better return keeping debt in check as a student.

 

It's always a great idea to work on savings discipline

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You can start a savings account Roth IRA at a place like ING Direct. Probably only $1 or $25 to open, and there's no minimums, so you don't have to stress out over making $200 monthly contributions. I started an IRA Savings Account with my Credit Union until I built up about $4000, then I transferred it to Vanguard mutual funds. With savings accounts at 0.20% to 1.00% APY (like ING), it won't grow much at all now, but the psychological benefit of "I started my first IRA!" is pretty powerful. At least it was in my experience.

 

The point is you're starting as early as possible. When it gets big enough, you can always move it to places like Fidelity or Vanguard.

Edited by Baddies4Breakfast

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trowe price used to be 50 a month, unsure if is still the case

 

It's still the case and thats who I went with as a senior in undergrad (now 28). I started at $50 a month and I'm now at $200 a month. Still not maxxing, but something is better than nothing. I wish I'd started sooner when my friend pleaded with me to at 19, but I felt I couldnt afford to save and had forever until retirement. Ha! My daughter will have a Roth as soon as she is able to.

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Just looking to get some advice. I have read up on the Roth IRA's for a bit of time and I am thinking of opening one up, but I was wondering if it was a smart idea, I see that places like fideilty make you deposit $200 a month to keep it, what happens if I do not have $200 for a month?

 

Also is it smart to open one now as I am a server not going to be able to max it out until I graduate and start my career, is it worth it putting a small amount in now just to get it started?

 

where did you see fidelity wants $200 contributions? I have not contributed to my roth for almost 10 years and have never been charged a fee or told I need to make min. deposits?

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trowe price used to be 50 a month, unsure if is still the case

 

It's still the case and thats who I went with as a senior in undergrad (now 28). I started at $50 a month and I'm now at $200 a month. Still not maxxing, but something is better than nothing. I wish I'd started sooner when my friend pleaded with me to at 19, but I felt I couldnt afford to save and had forever until retirement. Ha! My daughter will have a Roth as soon as she is able to.

 

the earlier the better is something that many youngsters, including me, didnt realize the value of. i dont have the numbers in front of me but my fav example is something that goes kind of like this:

 

if you start putting in X dollars a month in an account making 8% interest from the time you are 18 to 30, then never put a dime in...you will have more money than if you start at 30 and give until you are 65. The power of compounding!

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Just looking to get some advice. I have read up on the Roth IRA's for a bit of time and I am thinking of opening one up, but I was wondering if it was a smart idea, I see that places like fideilty make you deposit $200 a month to keep it, what happens if I do not have $200 for a month?

 

Also is it smart to open one now as I am a server not going to be able to max it out until I graduate and start my career, is it worth it putting a small amount in now just to get it started?

 

where did you see fidelity wants $200 contributions? I have not contributed to my roth for almost 10 years and have never been charged a fee or told I need to make min. deposits?

The minimum to open a Fidelity IRA is $2500. They'll waive that if you set up automatic $200 monthly contributions.

Edited by athensgaguy

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