What is a Roth IRA?
It’s a retirement account funded with posttax dollars. Withdrawals are generally tax and penalty free if you meet these requirements:
- You’ve owned the account for 5 years.1
- You're age 59½ or older.2
Who can open a Roth IRA?
Anyone with earned income can open a Roth IRA. However, in order to contribute, you must fall within the Roth IRA income limits. You can open a Roth IRA for yourself or someone else, even a minor.
Benefits of a Roth IRA
Figure out your max contribution
Your eligibility to contribute to a Roth IRA varies based on by how much you earn. Your modified adjusted gross income (MAGI) must be less than the annual limit set by the IRS. If your income is too high you can consider a backdoor Roth IRA.
Roth IRA investment options
Two ways to save for one goal.
Frequently asked questions
1The 5-year holding period for Roth IRAs starts on the earlier of: (1) the date you first contributed directly to the IRA, (2) the date you rolled over a Roth 401(k) or Roth 403(b) to the Roth IRA, or (3) the date you converted a traditional IRA to the Roth IRA. If you're under age 59½ and you have one Roth IRA that holds proceeds from multiple conversions, you're required to keep track of the 5-year holding period for each conversion separately.
2When taking withdrawals from an IRA before age 59½, you may have to pay ordinary income tax plus a 10% federal penalty tax.
3If you inherit a Roth IRA, you must take RMDs, but they're tax-free as long as the original account owner held the account for at least 5 years
4For the ten-year period ended June 30, 2025, 6 of 6 Vanguard money market funds, 75 of 102 Vanguard bond funds, 21 of 23 Vanguard balanced funds, and 171 of 193 Vanguard stock funds—for a total of 273 of 324 Vanguard funds—outperformed their peer group averages. Results will vary for other time periods. Only funds with a minimum quarter-, one-, three-, five-, or ten-year history, respectively, were included in the comparison. (Source: LSEG Lipper) Note that the competitive performance data shown represent past performance, which is not a guarantee of future results, and that all investments are subject to risks. For the most recent performance, visit our website at www.vanguard.com/performance
You may wish to consult a tax advisor about your situation.
For more information about Vanguard funds and ETFs, visit vanguard.com to obtain a prospectus or, if available, a summary prospectus. Investment objectives, risks, charges, expenses, and other important information are contained in the prospectus; read and consider it carefully before investing.
You must buy and sell Vanguard ETF Shares through Vanguard Brokerage Services (we offer them commission-free online) or through another broker (who may charge commissions). See the Vanguard Brokerage Services Commission and Fee Schedules for limits. Vanguard ETF Shares are not redeemable directly with the issuing Fund other than in very large aggregations worth millions of dollars. ETFs are subject to market volatility. When buying or selling an ETF, you will pay or receive the current market price, which may be more or less than net asset value.
All investing is subject to risk, including the possible loss of the money you invest. Be aware that fluctuations in the financial markets and other factors may cause declines in the value of your account.
Vanguard's advice services are provided by Vanguard Advisers, Inc. ("VAI"), a registered investment advisor, or by Vanguard National Trust Company ("VNTC"), a federally chartered, limited-purpose trust company.
The services provided to clients will vary based upon the service selected, including management, fees, eligibility, and access to an advisor. Find VAI's Form CRS and each program's advisory brochure here for an overview.
VAI and VNTC are subsidiaries of The Vanguard Group, Inc., and affiliates of Vanguard Marketing Corporation. Neither VAI, VNTC, nor its affiliates guarantee profits or protection from losses.