Fidelity Sees a 475 Percent Increase in Roth IRA Accounts for Kids
Fidelity Investments says between 2016 and 2018 they’ve seen a 475 percent increase in new Roth IRA accounts for kids. In just 2018 alone, between January and June, Fidelity’s Roth IRA for Kids product saw a 39 percent increase in accounts and 51 percent increase in assets.
According to Fidelity the growth can be explained by the fact that Roth IRAs accounts for kids are gaining popularity among parents with children under the age of 18 and relatives who want to help kids start saving.
It’s a good thing so many people are starting to save money for their kids.
Fidelity says starting early can make a big difference. Fidelity says with annual contributions of $5,500 starting at the age of 15, with an increase to $6,500 when the person turns 50, at the age of 70 the balance is $3 million, while starting at 45 years of age ends up being just over $422,000.