setting some of the earnings aside for a Roth IRA. Teens working summer jobs have a unique opportunity you can't get as an adult: to save for retirement 100% tax free. With a regular IRA, you avoid taxes now but pay them upon withdrawal in retirement. With a Roth, you pay the taxes now, but avoid them upon withdrawal. When you are a teen only making a few thousand dollars, you are below the threshold to pay income taxes today. So any of that money you can put into a Roth will never be taxed. The only catch is you can't put more into a Roth than you earned, so parents can just dump money into a Roth for a 4 year old. But a teen with a summer job does have some reported earnings, so they are eligible to make a Roth contribution.