It’s not too early for college students, especially those who have a substantial income from part-time and summer jobs to open an IRA account.

Individual Retirement Accounts, more commonly referred to simply as IRAs are a great way for people to save for eventual retirement.  If we can learn anything from the current economic meltdown, it is that jobs are not safe or guaranteed and that income loss at the wrong time can be a terrible thing for someone close to retirement.  This means that you need to start saving early, and save often. 

RAs are delineated into two main groups: Roth and traditional.  The differences are primarily tax-related. Traditional IRA contributions are often tax-deductible, something that can be a great tool to get into a lower marginal tax bracket.  Roth IRAs withdrawals are tax free, which will be great after your account has grown over the years.  Everyone who works can contribute to an IRA, though there are limits to contribute. 

With either the transactions within the account are tax free, which is a major advantage over regular accounts. 

If your view is long term, the Roth IRA is a better option, as withdraws will be tax-free.  But a tax deduction can be a very useful at a time when money is tight, because that is real money now.