It's never too early to save for retirement, with Social Security in short supply and with people living longer, it's more important than ever to start saving for your retirement as soon as possible. From my own personal experience with IRAs, I would suggest for the young people under 21 to get into a Roth IRA. The earlier you start saving, the more you will have when that time comes to retire. Take it from me, you will be happy you did in the later years of your life. Here are some of the differences between the Roth and Traditional IRAs. Unlike a Traditional IRA, you can contribute to a Roth even after you reached the age of 59 ½. Every contribution to the Roth IRA are tax deductible for certain individuals.

The eligibility for having one is a big difference however. With a Traditional IRA, there is no limit for those who can contribute, however, for the Roth IRA, you must make under $110,000 per year or if married, your combined AGI (Adjusted Gross Income) at or under $160,000. The Roth IRA was created by the Taxpayer Relief Act of 1997, and is considered one of the easiest ways to build your retirement money. Any contributions to the IRA are not taxed as that of Traditional IRAs. As of 2005, the annual contributions are $4,000 per year (or $4,500 if your over 50) and will increase in the coming years. Once you have opened your Roth IRA, you can have any number of investments in your IRA such as regular securities or CD’s if you prefer a safer investments.

But whatever you do, if you decided to take security choices into your own hands, please don’t take a lot of risks, you don’t want to loose all your money and have no money to retire on, obviously that would be missing the point. Have a financial advisor take care of this for you, it would be beneficial for you. If you feel you want to take risks, open a separate brokerage account and play around with discretionary money. Here’s a big reason to start early: No matter how much income you make, whether its $4,000 or $40,000 a year, your only allowed a certain contribution amount a year, remember as of 2005 its $4,000 and will increase in the following years. So, the more years you contribute the higher balance you will have and the faster that your IRA will grow.