Has anyone started an IRA with their stipend?

[archphd]

I was thinking about starting a Roth IRA with my stipend once I start. But, I am not sure how I am receiving the stipend, because the school's wording didn't clarify if it would be from a 1099 or a W2 (the first year of my fellowship is service free). I heard that if you contribute more to an IRA than your taxable income (ie if I got a 1099) you could get severely taxed.

 

Anyone else thinking of doing an IRA with their stipend? If not, anyone else thinking of starting some type of retirement fund? I have CDs already but was thinking of something that could yield higher earnings.

[Quantum Buckyball]

Yes I started my Roth IRA back in 2010 and it was one of the best decisions I've ever made for myself. I also have a CD as a emergency fund (3X of your monthly expenses).

I only contribute about 10-15% of my monthly income toward my retirement account though.

[archphd]

Was there an issue with the taxes? My first year of fellowship is service free, and my mom's accountant told me that if they gave the fellowship as "service free" and did not consider it income, and contributions I made that exceeded the income would have been taxed. I note this also because in my acceptance note they said my first year fellowship would be "my responsibility to claim through taxes" and subsequent years they would be reporting my income to the IRS, since it would be through teaching/employment. Should I wait to see how my first year fellowship money is going to be distributed and what sort of tax form it will include?

[Provincial Cosmopolitan]

What kind of stipends do you have that you can start and IRA or a CD with three times your weekly income!?