help.........

[Guest chris g]

ok i need to know how to set an IRA up and i need to know the starting requierments to start an IRA and can i start 1 up at the age of 17

[wmyer]

Chris, you can start an IRA at any age under 70 1/2, as long as you have income. You can do this by going to pretty much any bank, or by finding a financial institution on-line (like E*TRADE BANK or SCHWAB). Each bank will have its own minimum requirement; some may require $500, others $1000, some have no minimum. The maximum per year is $2000. Before opening an IRA, though, there are a lot of considerations you should take into account -- whether you want a Traditional IRA or Roth, what the fees are for the investment institutions, what investment options they offer, what investment options you're looking for, &c. The sooner you start an IRA, the better. Good luck!

[John G]

IRAs for children has come up before, see these:

http://benefitslink.com/boards/index.php?showtopic=9284

http://benefitslink.com/boards/index.php?showtopic=8885

http://benefitslink.com/boards/index.php?showtopic=7683

http://benefitslink.com/boards/index.php?showtopic=7656

Another short citation on children and Roths

http://detnews.com/2000/business/0007/04/b10-85589.htm

From my prior posts:

You need to think about two things on the front end: who is my custodian, and what type of investments am I likely to make. Custodians can include banks, brokerages, mutual fund families, etc. Many of the brokerages such as Schwab and Etrade give a chance to buy stocks, bonds and mutual funds. You can move a Roth account, so initial choices do not bind you forever. NOTE: Etrade will not accept IRAs for minors, but Charles Schwab does. So, you need to ask a few potential custodians if the age 17 is a problem.

Lots of folks have no problem dealing with out of town firms, especially now that they almost all have outstanding web sites. Banks used to have fairly conservative choices but are starting to offer more options. Banks are ussually local and you may value face-to-face service. But don't expect to call a bank employee using an 800 number at 11pm, and many have poor internet options. You may want to read the March issue of Consumer Reports or subscribe to Kiplinger Personal Finance mag. Both a good sources for beginners.

Ask about fees. There are many firms that do not charge any annual fees for IRA accounts. Others charge $10-20 per fund or per account. Some eliminate the charges if you just ask, or when your assets grow. The brokerage commission fees for trades range from ultra low to high. Same with the imbedded expense rates for mutual funds. Since there are perhaps 8,000 stocks and another 8,000 mutual funds it is impossible to generalize. The nice thing about Consumer Reports is that the boil down the mutual fund choices to a hundred or so good ones and explain things in laymen terms.

My suggestion for beginners: invest in a growing future by putting your IRA funds into a general stock mutual fund and a very good version of these is a broad based index fund like on that mirrors the S&P500. Why? Easy to track, easy recordkeeping, market performance, diversification and low cost/expense. After 4-5 years of contributing and letting this account grow you may want to split your assets between a couple of funds. Later still, when you pass the 100k mark you may feel comfortable with owning 8 to 12 individual stocks.

Equities (aka stocks) are an investment in growth. Sure, stock markets go up and down. But good years out number bad years by anywhere from 5:1 to 8:1 and over many decades equity investments will do a better job (much better than CDs) of growing above the general rate of inflation.

Got more questions? Post 'em here. We aim to please and be informative.

Starting so young! Good for you.

[Guest chris g]

thanx a bunch guys ill take those ideas and apply them this next week-end, thanx again.