Data and Research

Nearly Two-Thirds of Americans Participate in Their Retirement Plan

ICI examined newly available data from the IRS and found that 63% of Americans participate in their retirement plan either directly or through their spouse.

By Lee Barney editors@plansponsor.com | July 26, 2017

Relying on newly available data from the Internal Revenue Service (IRS), the Investment Company Institute (ICI) found that 63% of Americans between the ages of 26 and 64 participate in their companies' retirement plans, either directly or through their spouse. These findings from the ICI report “Who Participates in Retirement Plans?” run contrary to data from the U.S. Bureau of Labor’s Current Population Survey (CPS), which, ICI says, underestimated retirement plan participation between 2008 and 2013 by five percentage points.

“More American workers are benefiting from employer plans than the conventional wisdom would suggest,” says ICI Senior Economist Peter Brady, who wrote the ICI report. “The most commonly cited statistics underestimate retirement plan participation, [and] most statistics lump together younger and older workers, ignoring the fact that participation rate increases as workers approach retirement.”

The IRS data shows that 52% of those between the ages of 26 and 34 participate in their retirement plan. That increases to 63% for those between the ages of 35 and 44, 67% for those between the ages of 45 and 54 and 68% for those between the ages of 55 and 64.

The data also indicate that participation increases as income rises. Seventy-three percent of individual filers with adjusted gross incomes (AGIs) of $20,000 or more and joint filers with AGIs of $40,000 or more participated in their retirement plans directly or through a spouse. That rises to 85% of those with AGIs of $100,000 or more.

ICI’s full report, "Who Participates in Retirement Plans," can be downloaded here.

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