Best Roth IRA For Kids
If the income restrictions on Roth IRAs prevent you from using one for your own planning purposes, you should consider encouraging your children or other younger family members to establish and fund a Roth IRA of their own. The best Roth IRAs offer ample tax benefits for retirement, and this is especially true for younger investors.
They can also be used as a wealth transfer mechanism. Setting up a Roth IRA for a child can be one of the bet long-term investment strategies, because investment compounding over a 50 year period can turn even a relatively modest savings rate into substantial wealth. There is no minimum age requirement for opening a Roth IRA, and many providers will accept accounts for minors. The only real issue can be whether the child has taxable earned income, but there is no requirement that this income must fund the IRA.