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Is There a Right Age for Opening an IRA?

Retirement Planning
four neighbors of various ages eat at a block party and discuss when is a good time for opening an ira

Key Takeaways

  • The longer you wait to start saving for retirement, the harder it becomes to accumulate a substantial nest egg. Compound interest plays a significant role in growing your retirement savings over time.
  • Investing in retirement savings accounts like a 401(k) or an individual retirement account (IRA) can help your money grow as the stock market generally outpaces inflation rates, providing a better chance of achieving your retirement goals.
  • If you find yourself behind on retirement savings, consider increasing your income, reducing expenses, and making catch-up contributions to your retirement accounts. Extending your working years and delaying retirement can also significantly boost your retirement savings and improve your Social Security benefits.
  • Contributions to tax-deferred retirement accounts like 401(k), 403(b), or traditional IRA can reduce your taxable income and lower your overall tax burden, helping you save more for retirement.
  • While starting early is beneficial, it's never too late to begin saving for retirement. Implementing the right financial strategies, such as catch-up contributions and increased income, can still improve your financial future.

Opening a traditional individual retirement account (IRA) is one of the most popular ways to save for retirement because you can delay paying taxes on your investment earnings as long as you keep the money in the account.

Many people realize these accounts can be helpful at some point in their lives — but you might not be sure when opening an IRA makes sense. These accounts can potentially be useful at nearly every life stage, and there really is no "right" age to open one up.

Before Working Full-Time (22 & Younger)

There's no minimum age for opening an IRA. Students can open one for themselves, and parents can open an account on behalf of their young children. Getting such an early start can help make hitting retirement goals easier later on.

Younger people also need to remember you can only fund an IRA with earned income — money you get from work — and you can only add up to a maximum of $7,000 a year.1 Earned income could come from a summer job, babysitting, mowing lawns and so on. However, it can't come from a gift, an allowance or a similar source of income.

Early Career (22 to 35)

At the start of your career, saving for retirement is important, but you likely have plenty of other financial goals lined up — paying off student loans, saving for a house down payment and getting out of credit card debt to name a few.

It's okay if these might take up most of your budget. Luckily, you do not need a fortune to open an IRA. There's no minimum contribution required to open most IRAs. After that, you can add more on your schedule. For example, if you start to contribute to an IRA but want to pay for a car, you can pause payments then contribute again in the future

The earlier you start investing, the easier it generally is to reach your retirement goals. Every dollar you save at the start of your career has more opportunity to grow. Opening an IRA now and contributing even a small amount can help.

Prime Working Years (35 to 60)

This is when people typically start thinking about opening an IRA and with good reason. You're in your prime earning years, so you likely have the money to tackle this goal. At this stage of your life, it's generally a good idea to start saving as much as possible for retirement.

One goal is not only to open an IRA, but also to contribute the maximum amount possible each year. As of 2024, you can contribute a maximum of $7,000 a year when you're younger than 50 and up to $8,000 a year if you're 50 or older.1

If you do choose to max out every year, remember that if you fall short you can't make up contributions later, due to IRA contribution limits.

Approaching Retirement (60 & Up)

The IRA retirement age is 59½. This is when you can start making retirement withdrawals from the account without a tax penalty. But people are living longer and working later in life, which means you may want to keep saving past age 60.

To open and add money to an IRA during retirement, you must have earned income from some type of work. Social Security payments, investment income and pension income don't count.

Traditional or Roth IRA

You can contribute to your traditional IRA in the year you reach age 70½ and beyond, as long as you have earned income. You can also contribute to a Roth IRA, which doesn't have a maximum age limit.

At this stage, adding money to a Roth IRA not only saves for your future but is also an way to leave an inheritance for others. Your investments will grow tax-free in a Roth IRA, and when your family inherits it, the earnings will still be tax-free. If you ever need money for yourself, you can make withdrawals from your Roth IRA whenever you want (though you may still be taxed if you haven't funded the Roth IRA for at least five years or are under 59½).

In the end, there is no age limit for when to open an IRA. Whether you're nine or 90, the IRA decision comes down to how well it matches up with your current financial goals.


  1. 401(k) limit increases to $23,000 for 2024, IRA limit rises to $7,000. https://www.irs.gov/newsroom/401k-limit-increases-to-23000-for-2024-ira-limit-rises-to-7000.

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Information provided is general and educational in nature, and all products or services discussed may not be provided by Western & Southern Financial Group or its member companies (“the Company”). The information is not intended to be, and should not be construed as, legal or tax advice. The Company does not provide legal or tax advice. Laws of a specific state or laws relevant to a particular situation may affect the applicability, accuracy, or completeness of this information. Federal and state laws and regulations are complex and are subject to change. The Company makes no warranties with regard to the information or results obtained by its use. The Company disclaims any liability arising out of your use of, or reliance on, the information. Consult an attorney or tax advisor regarding your specific legal or tax situation.