Should I help my kid open a custodial Roth IRA if they have a summer job?

If your child has legitimate earned income, a custodial Roth IRA is one of the most powerful gifts you can give. The IRS allows contributions up to the lesser of the child's earned income or the annual limit, and there is no minimum age. Because the money grows for decades, even small teen contributions can become substantial by retirement, and qualified Roth withdrawals are tax-free. The earnings must come from real work with proper documentation; an allowance does not count. Parents commonly let the teen keep their paycheck for spending and contribute a matching amount to the Roth on their behalf. Beyond the dollars, it teaches investing early. Keep records of the child's wages in case the contribution is ever questioned.