Roth IRA Ownership Increases by 46%
10.4 Million Americans Now Own Roth IRA's; 28% Are First Time IRA Owners
WASHINGTON -- Ownership of the popular Roth IRA savings vehicle increased by more than 46% this year, according to statistics from the Investment Company Institute released this month. This year, 10.4 million (or about 10%) of American households own Roth IRAs; in 1999, 7.1 million households owned Roth IRAs.
Of the Roth IRA holders, nearly one in three (28%) are first time IRA owners. Furthermore, the median age of a Roth IRA owner -- 44 -- is significantly younger than the owner of a traditional IRA -- 53.
"These statistics are very encouraging. They show that both Americans who have not saved in an IRA before as well as younger Americans are saving in Roth IRAs," stated Senate Finance Committee Chairman William V. Roth, Jr. (R-DE), author of the Roth IRA.
"This dramatic growth in Roth IRA ownership just proves that if we build it, they will come. When Congress created these accounts, we weren't just writing legislation but allowing Americans to build their own field of dreams for the future. This growth is great but, like dreams, we shouldn't let it stop there. We should encourage these to grow even more and to let even more Americans participate in saving for their future."
The survey also showed that as of June, 2000:
• 42.5 million or 41% of U.S. households owned Individual Retirement Accounts
• Of those 42.5 million: 33.1 million held traditional IRAs; 10.4 owned Roth IRAs; and 7.4 million held SIMPLE IRAs, SEP IRAs or SAR-SEP IRAs
• Median income for traditional IRA household was $62,500
• Median income for Roth IRA household was $64,000
• 18% of traditional IRA houseolds also owned Roth IRAs
The full report is attached.
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