Can a child have a Roth IRA?

Yes — a child of any age can have a Roth IRA as long as they have earned income. There is no minimum age requirement set by the IRS. However, since minors cannot legally sign contracts, a parent or guardian must open a custodial Roth IRA on the child's behalf. The account converts to a regular Roth IRA when the child reaches the age of majority (18 in most states, 21 in some states).

How much can a child contribute to a Roth IRA in 2026?

The 2026 Roth IRA contribution limit is $7,000 per year ($8,000 for those 50+). However, a child can only contribute up to 100% of their earned income for the year, if that amount is less than the $7,000 limit. For example, if your child earns $2,000 mowing lawns in 2026, they can contribute up to $2,000 to their Roth IRA — not $7,000. The contribution can come from any source (including a parent's gift), but cannot exceed the child's earned income.

What counts as earned income for a Roth IRA for kids?

Earned income includes wages, salaries, tips, and net self-employment income. For children specifically, common sources include: wages from a W-2 job (retail, restaurant, sports camp counselor), self-employment income (babysitting, lawn mowing, tutoring, dog walking), and wages paid by a family business (if properly documented and reasonable for the work performed). Unearned income — interest, dividends, gifts, allowances — does NOT qualify.

Where can I open a custodial Roth IRA for a child?

The best custodial Roth IRA providers in 2026 include Fidelity (no minimum, no account fee, commission-free trades), Charles Schwab (no minimum, no fee), and Vanguard (requires $1,000 to invest in most funds, though $1 for ETFs). These custodial Roth IRAs are identical to adult Roth IRAs in terms of tax treatment and investment options. Avoid providers with account fees or high minimums for small balances. Fidelity is the most commonly recommended for custodial accounts due to zero minimums.

Why is opening a Roth IRA for a child so powerful?

Time is the most powerful factor in compound growth. A $7,000 contribution at age 10 invested in a broad index fund has 55+ years to grow tax-free before the child turns 65. At a 7% average annual return, $7,000 at age 10 grows to approximately $208,000 by age 65 — all tax-free. Every year of earlier investing adds dramatically to the final balance. A child who invests $3,000/year from ages 14 to 22 (9 years, $27,000 total) could have more at 65 than an adult who invests $3,000/year from ages 22 to 65 (43 years, $129,000 total), due to the additional compounding time.

Roth IRA for Kids 2026 — Custodial Roth IRA Rules, Limits & How to Open One

A Roth IRA for kids (technically a custodial Roth IRA) lets children invest tax-free starting at any age — as long as they have earned income. The 2026 contribution limit is $7,000, capped at the child’s earned income for the year. Money invested in a child’s Roth IRA at age 10 has over 55 years to compound tax-free by retirement — one of the most powerful wealth-building tools available.

2026 Custodial Roth IRA Basics

Rule	Detail
Minimum age	None (IRS has no minimum)
Contribution limit (2026)	$7,000 or 100% of earned income, whichever is less
Income requirement	Child must have earned income
Account type	Custodial (parent controls until majority)
Tax treatment	Contributions after-tax; growth and qualified withdrawals tax-free
Income limits	No income limit for children (typical Roth rules still apply, but children rarely exceed limits)
Age of majority	18 in most states; 21 in some states

What Counts as Earned Income for Kids

The IRS defines earned income as wages, salaries, tips, and net self-employment income. The following count:

Qualifies:

W-2 wages from any job (retail, restaurant, babysitting as employee, sports camp counselor)
Net self-employment income (babysitting, lawn care, tutoring, dog walking, social media management)
Wages from a family business (must be documented, reasonable compensation for actual work performed)
Acting, modeling, or performing income

Does NOT qualify:

Allowances
Gifts from parents
Interest, dividends, or investment income
Scholarships or fellowships (generally)

Documenting family business wages: If you pay your child to work in your business, use a time sheet, pay stubs, and reasonable market rates for the work. Paying a 12-year-old $7,000 to “consult” without documentation is a red flag for the IRS. Paying them $15/hour to pack boxes or help with inventory at a realistic number of hours is legitimate.

How the Contribution Limit Works

The 2026 Roth IRA contribution limit is $7,000. But a child can only contribute up to their earned income for the year.

Child Earns	Max Roth IRA Contribution
$500	$500
$2,000	$2,000
$5,000	$5,000
$7,000+	$7,000 (limit caps here)

Key flexibility: The money contributed to the Roth IRA doesn’t have to be the exact money the child earned. A parent can gift the contribution as long as the child has at least that amount in earned income for the year.

Example: Your 15-year-old daughter earns $3,500 lifeguarding over the summer. She wants to spend that money. You can contribute $3,500 to her Roth IRA using your own money — as long as her total annual Roth contribution doesn’t exceed her $3,500 in earned income.

The Power of Starting Early: Growth Projections

At a 7% average annual return (approximate long-term US stock market average):

Age Contribution Made	Single $7,000 Contribution at 7%/year	Value at Age 65
Age 5	60 years compounding	~$295,000
Age 10	55 years compounding	~$208,000
Age 15	50 years compounding	~$148,000
Age 22	43 years compounding	~$100,000
Age 35	30 years compounding	~$53,000

One-time $7,000 at age 10 → ~$208,000 at retirement, tax-free. Compare this to the same $7,000 invested in a taxable account paying 20%+ in long-term capital gains tax on gains.

Consistent Annual Contribution Scenario

If a teenager contributes $3,000/year from ages 14 to 22 (9 years, total invested: $27,000):

At 7% annual return, this grows to approximately $875,000+ by age 65
Every dollar is withdrawn tax-free
No Required Minimum Distributions (RMDs) during the child’s lifetime

How to Open a Custodial Roth IRA

Step 1: Choose a Provider

Best custodial Roth IRA providers:

Provider	Minimum	Account Fee	Notes
Fidelity	$0	$0	Best for small balances; fractional shares; ZERO index funds
Charles Schwab	$0	$0	Excellent funds; fractional shares
Vanguard	$0 ETFs	$0	$1,000 minimum for most mutual funds; ETFs start at ~$1
E*TRADE	$0	$0	Good platform; custodial available

For most families: Fidelity is the top recommendation for a custodial Roth IRA due to no minimums, no fees, and excellent index fund options.

Step 2: Open the Account

Go to the provider’s website and select “Custodial Roth IRA” or “Minor’s Roth IRA”
Provide parent/guardian Social Security number, date of birth, and address
Provide child’s Social Security number and date of birth
Link a bank account for funding
Complete identity verification

Most online applications take 15–20 minutes. You’ll need the child’s SSN — if they don’t have one, apply for one at the SSA first.

Step 3: Fund and Invest

Once the account is open:

Transfer funds from your linked bank account
Select investments — for long time horizons, a broad index fund is typically best
Set up recurring contributions (optional but powerful)

Investment suggestions for a child’s Roth IRA:

Fidelity ZERO Total Market Index Fund (FZROX) — 0% expense ratio
Vanguard Total Stock Market ETF (VTI) — 0.03% expense ratio
iShares Core S&P Total US Stock Market ETF (ITOT) — 0.03% expense ratio

At a 50+ year time horizon, a low-cost total market index fund is appropriate for most families.

Rules for Withdrawals

The Roth IRA 5-year rule and 10% early withdrawal penalty apply to custodial Roth IRAs just as with adult accounts:

Withdrawal Type	Tax?	Penalty?
Contributions (at any age)	No	No (contributions can always be withdrawn penalty-free)
Earnings before 59½ and before 5-year rule	Yes	10%
Qualified distribution (59½+, account open 5+ years)	No	No

Caution: A child who opens a Roth at age 10 can withdraw contributions (not earnings) tax and penalty-free at any age. However, withdrawing earnings before 59½ triggers taxes and a 10% penalty. The goal should be to leave the account untouched through retirement.

Common Questions

Can a parent contribute to their own Roth IRA and a child’s? Yes. The $7,000 limit is per person. A parent can contribute $7,000 to their own Roth IRA and separately contribute up to $7,000 to their child’s Roth IRA (subject to the child’s earned income limit).

What happens when the child turns 18? The custodian (parent) is removed and the child takes full control of the account. The Roth IRA status and tax benefits remain unchanged.

Does a child need to file taxes to contribute? A child doesn’t necessarily need to file a tax return to make a Roth IRA contribution — but their earned income must be documented. If a child earns above the filing threshold, they likely need to file. If they earn below it (under ~$14,600 in 2026 for single filers), they may not need to file but should keep documentation.

Written by WealthVieu

WealthVieu researches and writes data-driven personal finance guides using primary sources including the IRS, Bureau of Labor Statistics, Federal Reserve, and Census Bureau.

The content on Wealthvieu is for informational purposes only and should not be considered financial, tax, or investment advice. Consult a qualified professional before making financial decisions. Full disclaimer · Editorial policy