There's no minimum age for a Roth IRA — only a requirement for earned income. A teenager with a summer job can contribute. A first-year employee can contribute the week they start. The question of "when to start" has one answer: as soon as you're eligible. The question worth more attention is how to prioritise it against other financial goals, and whether Roth is the right account type for your situation.
The cost of waiting
Every year you delay is expensive in a way that can't be recovered.
| Age at contribution | Amount contributed | Value at 67 (7% return) | Tax-free growth |
|---|---|---|---|
| 22 | $7,000 | ~$110,000 | ~$103,000 |
| 25 | $7,000 | ~$90,000 | ~$83,000 |
| 30 | $7,000 | ~$64,000 | ~$57,000 |
| 35 | $7,000 | ~$46,000 | ~$39,000 |
| 40 | $7,000 | ~$33,000 | ~$26,000 |
These are single-year contributions. Someone who contributes $7,000/year from age 22 through 67 (45 years) accumulates roughly $3–4 million in tax-free wealth at 7%. Starting at 32 with the same annual contribution leaves roughly $2–2.5 million. The 10-year gap costs over $1 million in final balance.
The rules
Contribution limits, income limits, and the earned income requirement.
You can contribute up to $7,000 per year, or your total earned income for the year if it's less than $7,000. A student earning $4,000 over the summer can contribute up to $4,000 — not $7,000. The tax year deadline for contributions is April 15 of the following year.
You must have earned income (W-2 wages, 1099 self-employment income, tip income). Investment income, rental income, and pension income don't count. Summer jobs, part-time work, and freelance all qualify. There's no minimum age — a 16-year-old with a job can open a Roth IRA (as a custodial account if under 18).
Single: full contribution below $150,000 MAGI; phases out $150k–$165k; no direct contribution above $165k. Married filing jointly: full contribution below $236,000; phases out $236k–$246k. Above these limits: use the backdoor Roth (non-deductible traditional IRA → immediate conversion).
If you're married filing jointly and one spouse has no earned income, the working spouse's income can fund a Roth IRA for the non-working spouse. Both spouses can contribute $7,000/year (up to the household's total earned income). A household earning $80,000 with one income can put $14,000/year total into Roth IRAs — one for each spouse.
Roth vs Traditional — which one?
In your 20s and most of your 30s, Roth almost always wins.
| Roth IRA | Traditional IRA | |
|---|---|---|
| Tax treatment | After-tax contributions; tax-free withdrawals in retirement | Pre-tax contributions (if deductible); taxed on withdrawal |
| Best when | Current tax rate is lower than expected retirement rate | Current tax rate is higher than expected retirement rate |
| Required Minimum Distributions | None during your lifetime | RMDs from age 73 |
| Early withdrawal flexibility | Contributions (not earnings) can be withdrawn tax- and penalty-free anytime | Withdrawals before 59½ trigger tax + 10% penalty |
| Income limits | Phase-out $150k–$165k (single, 2025) | Deductibility phase-out if covered by workplace plan: $79k–$89k (single, 2025) |
For most people in their 20s and early 30s, Roth is the right choice: you're likely in the 10–22% federal brackets, and retiring into a higher bracket (from RMDs, Social Security, accumulated savings) is a real possibility. Pay tax now at 12%, withdraw tax-free later instead of paying 22–24% at retirement.
The priority order
Where Roth IRA fits against your other financial goals.
Capture your full 401(k) employer match first
An employer match is an instant 50–100% return. Nothing — including a Roth IRA — competes with free money. Fund your 401(k) to at least the match threshold before opening a Roth IRA.
Free money — always comes firstBuild a 3–6 month emergency fund
Roth IRA contributions (not earnings) can be withdrawn penalty-free, which gives some emergency fund flexibility — but this is not a strategy. Maintain a real emergency fund so you never need to touch retirement savings.
Foundation — prevents retirement account liquidation in a crisisMax your Roth IRA: $7,000/year (2025)
After the employer match and emergency fund, this is the next dollar for most people in the 10–22% bracket. Tax-free growth for potentially 40+ years on $7,000/year of after-tax contributions is among the best wealth-building tools available.
Tax-free growth — the best long-term account for lower-bracket earnersMax your 401(k): $23,500/year (2025)
After the Roth IRA, go back to the 401(k) and fill it to the annual limit. Pre-tax contributions reduce your taxable income now; useful in years when income spikes or when you want to reduce current-year tax.
Pre-tax deduction — useful at higher income levelsCommon reasons people delay: "I'll do it when I earn more," "I want to pay off student loans first," "I'm not sure what to invest in." All of these can be addressed after opening the account. You can open a Roth IRA with $100 and invest in a target-date fund in under 20 minutes at Fidelity, Vanguard, or Schwab. The delay costs you compound growth you can never recover. Open it first, optimise later.
Should you open a Roth IRA now — and how much should you contribute?
Franky works through your income, tax bracket, employer match, and other goals to tell you exactly how to prioritise the Roth IRA in your specific situation.
Talk to Franky →