Total Individual Account Retirement Plan Assets, by Demographics, 2004

March 2008, Vol. 29, No. 3
Paperback, 12 pp.
PDF, 680 kb
Employee Benefit Research Institute, 2008

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Executive Summary

Most recent data on family finances—This analysis uses the most recent data (2004) from the Survey of Consumer Finances (SCF), a triennial survey of family finances by the Federal Reserve Board, as well historical SCF data, to examine the demographic factors associated with the ownership of individual account retirement plan assets. It examines the distribution of total assets held in individual account retirement plans across demographic characteristics of American families. Distribution of the retirement plan assets is then compared against the distribution of all assets owned across these demographic characteristics.


Concentration of assets—The data show that individual account retirement plan assets are concentrated in families with higher net worth, higher family income, higher educational attainment, with older family heads, and with white, non-Hispanic heads. Among families with low levels of assets, the savings in individual account retirement plans account for a greater share of their total financial assets than they do for families with high asset levels.


Asset levels and account types—Total individual account retirement assets—which include employment-based defined contribution (DC) plan assets (both of active plans and plans held at former employers in the public and private sectors), individual retirement account (IRA) assets, and Keogh account assets—amounted to $6.767 trillion in 2004, according the Survey of Consumer Finances. These assets were almost evenly split between employment-based DC plan assets, such as 401(k)s ($3.384 trillion), and IRA/Keogh account assets ($3.383 tril-lion).


Older family heads hold most assets—The most significant shift in individual account assets from 1992 to 2004 has been the fraction of assets held by families headed by individuals age 55 or older. More than one-half of all individual account retirement plan assets and more than two-thirds of IRA and Keogh plan assets are owned by families headed by these individuals. This fact illustrates the importance of educational efforts and product availability (annuities, fixed withdrawal products, etc.) to individuals as they begin to spend down their assets to pay for retirement expenses.