Can Kids and Teens Open A Roth IRA?
There is no age minimum for opening a Roth. The requirement (as far as kids are concerned) is that contributions to a Roth IRA must be from eligible earned income, and contributions cannot exceed annual income. Translation – if your kid does not earn any money, you cannot open and fund a Roth IRA for them. However, if your kid has a part time job, she can contribute up to 100% (maximum of $5,000) of her income into the Roth. Therefore, if she makes $2,000 per year, she cannot contribute more than $2,000 annually. Remember: Kids are still subject to the same contribution limits as adults. So in 2010, a single person cannot contribute more than than $5,000 to a Roth IRA. However, some brokerages, like Fidelity as an example, may require your child to be 18 years old. In that case, you need to find a broker who will allow them to open an account.
