EBRI Notes

'IRA Assets and Contributions, 2007,' and 'Domestic Partner Benefits: Facts and Background'

Sep 11, 2008 16  pages


IRA Assets and Contributions, 2007

IRAs are the largest repository of U.S. retirement wealth: Total IRA assets are larger than those accumulated in either private-sector defined benefit (pension) plans or defined contribution (401(k)-type) plans. At year-end 2007, IRAs held $4.75 trillion, private-sector defined contribution (401(k)-type) plans held $3.49 trillion, and private-sector defined benefit plans held $2.33 trillion. IRA growth continues to be fueled by rollovers from other types of retirement plans, not new contributions.

Mutual funds hold most IRA assets: There has been a big shift in market share in IRA assets over the past quarter-century, with mutual funds and brokerage accounts now dominant. Mutual funds held 47 percent of IRA assets at year-end 2007, followed by brokerage accounts (38 percent). Life insurance companies (8 percent) and banks/thrifts (7 percent) split the remainder.

Traditional IRAs still hold most assets: About 90 percent of all IRA assets are held in traditional (taxable on withdrawal) IRAs, but most contributions are going into Roth (untaxed at withdrawal) and other types of IRAs.

Domestic Partner Benefits: Facts and Background

September 2008 update: This article updates previous research by EBRI providing information on why employers offer domestic partner health benefits, legal issues involved, recent developments, and current data.

Domestic partner benefits do not drive up benefit costs: Employers that provide domestic partner benefits do so to attract talented employees from a diverse work force and as a matter of fairness. Studies have shown that offering domestic partner health coverage costs employers no more than spousal health coverage, and that few workers choose the benefit when it is offered. The vast majority of workers who enroll in domestic partner benefits tend to be unmarried heterosexual couples.

Domestic partner benefits remain taxable: Domestic partner health benefits, unlike spousal benefits, are treated as taxable income. Since marriage is regulated at the state level, and some states have legalized same-sex marriages, it might appear that same-sex spousal health benefits would also be tax-exempt. However, the federal Defense of Marriage Act (DOMA), which defines “marriage” as a legal union between one man and one woman, denies favorable tax treatment of same-sex spousal health benefits.