In brief, a Roth IRA is a tax sheltered asset building tool created by Congress for people who have earned income (aka salary or wages). You can currently set aside a maximum $2,000 per year, recent legislation will increase this amount eventually to $5,000. The Roth is a tax shelter, if you follow the rules the withdrawals are tax free. Someone who starts at your age on continously pumps 2K into the Roth each year could very easily build a nest egg of more than $1 million.
While the money is yours and you direct the investment, a "custodian" holds the assets. Potential custodians include banks, mutual funds and stock brokerages. You have lots of choices and companies often have promo materials for helping someone get started. Financial firms love IRA customers because the accounts usually have a long life.
To find out more about Roths, try reading some of the material at the companion site
www.rothira.com , or go to your local library and read articles in Money, Worth, Kiplinger, or Consumer Reports issues from the tax season (March or April). You will also find information on the web sites of many banks, mutual funds and brokerages.
Want to get started? Get info from atleast three different custodians and compare what they say. The post your questions and we will do the best to answer them.
This is a very simple overview of the Roth. Most folks meet the various requirements. This is one of the premier ways to build a nestegg over the long haul.
just 16W on this end