Im visiting a Mercantile Bank tomorrow about a Roth IRA, what do I need to know?

Burt Cheevers: I suggest a person not do this unless they have money in savings first.Liquid savings. Not tied up in retirement.This should be 5 months worth of income.You never know when you will want to buy a new car, move out of your home, have medical not covered by insurance, or if you will lose a job.First things first - savings in place, no matter what the interest rate.If you don't have this, cancel that appointment.Personal finances have a lot to do with common sense. Do the right thing, and don't tie up money unless you have an emergency fund first.You have no plans to go to college? You might even need this money for college....Show more

Dexter Dicostanzo: Congrats on starting to put money away early on! My advice is that if the women you're talking with can't explain your options without confusing you should go somewhere else. It's nice to have your money near your house but there are many options for where to open your IRA. Try to avoid as many fe! es as possible, especially if it's Mercantile charging you to have an IRA since many places will open and maintain one for free, one or two percent can add up to be A LOT over the next 50 years. One thing to know is that you won't likely be able to take the money except for school, medical emergencies or buying a house without paying a penalty until you're at retirement age (and you need to wait 5 years to take out any principal before that). If you're smart enough to open an IRA at 18 (I wasn't) than I'm guessing you already knew that though. PS If you're in Michigan (that's where Mercantile showed up when I googled it) look if there is a sutton bank near you. They offer a 2.01% APY checking account which is a great interest rate, much higher than any savings accounts out there. There are some requirements that you probably wouldn't be able to meet without steady income but keep it in the back of your mind for the future....Show more

Billie Bratchett: I've by n! o means heard of a five.five% provider rate for a Roth IRA. Ho! wever, your pal can have invested in an "entrance loaded mutual fund", which expenses you a percent (five.five% is pricey, however now not remarkable) of your resources to go into the fund. Tell your pal to invite what the rate represents.