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Discussion Starter · #1 ·
Any of you out there have a Roth IRA? I just opened one up and dumped $2,500 into it but I have no idea what the interest rate is... just tryin to see what others have to get an idea...

So now I'm 19 with State Retirement, Deferred Comp, and a Roth IRA.

Thanks Dad for turning me into a retirement freak
 

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Discussion Starter · #4 ·
eh i'll get a better interest rate than my savings account... that way it'll earn more money so i'll have more to fix my bike when i wreck it
 

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Zippy's My bitch
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You don't think of a Roth IRA in terms of interest rate, but in annual rate of return. And like any other fund you return is based on the performance (gain/loss) of that fund. I opened one 10 years ago when I was 18 and I'm more then pleased with it's valuation as of today. It's a great tool for a young investor as yourself.

Here is an article that covers all the basics of a Roth IRA:

http://www.kiplinger.com/columns/starting/archive/2006/st0309.htm
 

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I got a piece of mail yesterday from the Social Security Administration telling me what my retirement benefits will be when I retire in 2050. I just laughed.

Not sure if I read it wrong, but the comment was made that a Roth IRA will get a better return than a savings account so you have more money to fix your bike, once you put money in the retirement account, you should leave it there. It is true you can take out Roth contributions before retirement, but it is highly unadvised.

Great to see another young person is thinking ahead. I am 24 and have had a Roth since I was 18. I contribute the max I can to a Roth ($416 per month) and continue to do my work retirement plan (which I work for the state, so it is not a normal 401K, it is an annuity.
 

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yes a roth isn't based off an interest rate, but just your earnings as most are in the stock market or bonds. If you put it into a money market then you'll get an interest rate of a few %. At your age most financial managers will tell you to put it in the market or a good bit of it as you have years and years to go through the ups and downs of the market and overall you'll make more in the market.

Nice thing about a roth is that you can take out what you put in penalty free. Only the money you make has to stay in there until you're in you're 60's to be taken out without penalties. It's probably the best retirement vehicle for younger people...Good on you for setting it up. Keep dumping stuff in there and you'll see a nice chunk accumulate for retirement, a house, etc later on the down the line.
 

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Discussion Starter · #9 ·
stevedave said:
I got a piece of mail yesterday from the Social Security Administration telling me what my retirement benefits will be when I retire in 2050. I just laughed.

Not sure if I read it wrong, but the comment was made that a Roth IRA will get a better return than a savings account so you have more money to fix your bike, once you put money in the retirement account, you should leave it there. It is true you can take out Roth contributions before retirement, but it is highly unadvised.

Great to see another young person is thinking ahead. I am 24 and have had a Roth since I was 18. I contribute the max I can to a Roth ($416 per month) and continue to do my work retirement plan (which I work for the state, so it is not a normal 401K, it is an annuity.
yeah i was just kidding about using it to fix the bike


I'm going to put in the max allowed ($4g's a year) and not touch it until i retire


motomummy said:
yes a roth isn't based off an interest rate, but just your earnings as most are in the stock market or bonds. If you put it into a money market then you'll get an interest rate of a few %. At your age most financial managers will tell you to put it in the market or a good bit of it as you have years and years to go through the ups and downs of the market and overall you'll make more in the market.

Nice thing about a roth is that you can take out what you put in penalty free. Only the money you make has to stay in there until you're in you're 60's to be taken out without penalties. It's probably the best retirement vehicle for younger people...Good on you for setting it up. Keep dumping stuff in there and you'll see a nice chunk accumulate for retirement, a house, etc later on the down the line.
yeah i have a money market as well, since i save about a grand a month and only allowed to put 4g's a year into the Roth IRA the rest goes into the money market :biggrin

I just didn't really know how the Roth's worked but thanks for the info guys!!!!
 
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