Recent News

9/7/2010: New Losses Hit 529 College Savings Plans: A new wave of losses is hitting 529 college savings plans. 6/10/2010: Raising Child Costs $222K, College Not Included: The cost of raising a child is rising. And expectant parents better get ready for some serious sticker shock - $222,360 worth. 6/10/2010: CSU trustees to may raise student fees 10%: California State University trustees have raised fees 8 times in 10 years. Now they are prepared to raise fees again on June 18 by 5 or 10% 6/8/2010: 4 Things to Know About 529 Plan Withdrawals: Withdrawals are not necessarily tax free, even in years with heavy college costs. more...

What Others Are Saying

IRAs for Kids?: Not only will modest contributions add up to significant savings...but it's also a way to teach your child an invaluable lesson - one he or she isn't likely to learn in school. - Smart Money IRAs for Kids: It will only take a few seconds for you to realize how powerful this can be for your child's investing and financial future. - Motley Fool Start your kids on the Roth road: ...a Roth IRA offers the greatest opportunity for growth because the money grows tax-free. Kids don't need the deferred taxes feature of a traditional IRA because they're probably not paying taxes. - Bankrate.com Why Your Kids Need a Roth IRA: Looking for the perfect gift for your children? Open a Roth for them, and start them on the road to retirement security. - Kiplinger more...

Why is a Kid IRA® a Roth IRA?

At The Kidira Foundation, we fully endorse and encourage the use of a minor/custodial Roth IRA. The main reason is because money deposited by a minor into a custodial account is taxed minimally compared to other types of accounts.

No Taxes In, No Taxes Out

In typical investing situations, investors are either taxed when they put their money into an investment vehicle (529(b), Roth IRA, SEP IRA, etc.) or taxed when they take their money out of the investment vehicle (401(k), Traditional IRA, Solo(k), etc.). In some typical transactions (Stock Brokerage account), investors are taxed twice!

However, with a Kid IRA®, young investors are able to bypass the negative impact of taxes by investing in a qualified Roth IRA. As minors, they are NOT subject to income taxes for the first $5000 that they earn. Then, once they place this income into a Roth IRA, they will NOT be subject to taxes when they eventually withdraw from their Roth IRA.

In summary, they will be given the opportunity to put more money to work, and thus receive much larger returns on their investments.

The Fine Print

In order to participate in a Roth IRA, individuals must be generating earned income. That's where The Kidira Foundation comes in. As part of our Empower initiative, students can become an independent marketing associate of The Kidira Foundation, and earn income by simply marketing stores of the Kidira Network. As sales are generated, commissions will be paid directly to the student as earned income, thereby allowing them to invest in their own Kid IRA®, and reaping the benefits of the Roth IRA.

Kid IRA® vs. 529b Savings Plan

Kid IRA® vs. 529 Savings Plan Calculator