It is hard to believe that it has been 45 years since the individual retirement account (IRA) was created, resulting from the Employee Retirement Income Security Act [ERISA].
Here are some of the IRA highlights as we celebrate the 45th birthday.
- Today, IRAs have about $9.7 trillion in assets.
- IRAs make up a third of the US retirement market. Government policy has contributed to this growth when they designed the IRA. It could be a contributory vehicle for workers who didn’t have a 401k plan at work, and the IRA also serves as a retirement vehicle to hold former employer funds as you change jobs. Separated employees can transfer balance from their defined contribution plan or defined benefit plan and roll them over into an IRA.
- Policymakers have also added to the IRA menu over the years, with the addition of the Roth IRA in 1998 as well as IRA for the self-employed, such as the SEP and SIMPLE IRA.