Start a retirement account with only $50!
November 4th, 2006 by digerati
Looking around at the major brokerages recently I noticed that it may not be so easy for many people to open a retirement account. I’ve mentioned that I think having an Roth IRA is very important, in fact, having one as early as possible is important due to the effects of compound interest.
The problem is that the typical minimum investment to open an account is $1000-3000. That’s more than someone just starting their first job is likely to have in a lump sum.
T. Rowe Price has an option to open an IRA account for only $50. Instead of taking a large minimum, you setup a automatic deduction from your bank account each month.
This is great for a couple reasons:
- You don’t need a lot of money to open the account
- You are automatically saving a little even if you don’t pay attention to the account again.
Better yet, do direct deposit and the money enters and leaves without you realizing it. I do not have any T Rowe Price accounts, so I can’t say if you can increase the monthly amount but I’m sure they would let you. You can then decide (using your budget) what amount you should save to your IRA and then have the automatic deduction.
3 Responses to “Start a retirement account with only $50!”
BD’s Favorite Personal Finance Posts This Week (11/5/06) » Personal Finance - Save Money - Retirement - Financial Freedom
[…] Start a retirement account with only $50! @ Catch A Gideon. Brendan talks about how T. Rowe Price has an option to open an IRA account for only $50. I wish this was around when I was younger. Related Posts: […]
Pingback on Nov 5th, 2006 at 10:05 am
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BD’s Favorite Personal Finance Posts This Week (11/5/06)…
Happy Sunday, Sucka MCs. Personal finance bloggers were tapping on their keyboards to give you the very best advice and stories in personal finance.
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Here are 5 posts around the horn this week:
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How To Invest In Index Funds Without Much Money? - Personal Development for Smart People Forums
[…] Originally Posted by Alvin It seems like index funds are the way to go for the long-term, low-risk security basket. The problem is, the Vanguard 500 index, which looks really good, has a minimum of $5000 to open an account. Is there anyway to start investing small amounts into index funds without bursting the bank? Here’s an article from Brendan that mentions that you can start an IRA for $50 bucks: Start a retirement account with only $50! at Catch a Gideon Also, you can also look into various ETFs (Exchange Trade Funds). It’s the combination of index investing with the handiness and lower costs of individual stocks. __________________ Henry! Binary Dollar - Personal Finance For Dummies. […]
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