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$500/month starting at 22 grows to $1.9M tax-free by 65. Start at 30 and you'll have $600K less. Time is everything.
A Roth IRA's tax-free growth is powerful at any age. But starting 8 years earlier adds $600,000 in tax-free wealth with the exact same monthly contribution.
$1.9M
Start at 22 → Age 65
$500/month, 10% return
$1.3M
Start at 30 → Age 65
Same $500/month
$600K
8-Year Head Start Value
Extra wealth from starting early
$500/month: Start at 22 (green) vs. Start at 30 (gray)
Roth IRA vs Traditional IRA
| Feature | Roth IRA | Traditional IRA |
|---|---|---|
| Tax on Contributions | Taxed now (low bracket!) | Deductible now |
| Tax on Withdrawals | TAX-FREE forever | Taxed at future rate |
| Best When | Low income now (college!) | High income now |
| Required Distributions | NONE ever | Must withdraw at 73 |
| Early Withdrawal | Contributions anytime | 10% penalty before 59½ |
College = Lowest Tax Bracket
Open at Fidelity or Vanguard
No minimums. Takes 15 minutes online. Choose 'Roth IRA' account type.
Start with $25-$50/month
Set up auto-invest. Even $25/month at 22 = $150K+ by 65.
Buy One Fund: Target Date
Pick the target date fund closest to your 65th birthday. Done.
Increase with Every Raise
Bump contribution by $50 every time income goes up. You won't miss it.
$50/month × 43 years × 10% avg return = $470,000 (tax-free)
Even tiny amounts become massive with 40+ years of compound growth
Contributions Are Accessible
Don't Actually Use It
Key Takeaways