Demographics Drive IRA Ownership, Size

June 22, 2001 ( - Race, gender and age have a closer relationship to IRA balances than income levels do, recent research by the Employee Benefit Research Institute (EBRI) finds.

Although monthly income does not have a large impact on the average account balance, it did affect the likelihood of account ownership, according to EBRI


EBRI?s analysis of data from the US Census Bureau on Americans, age 21 and older, shows that the groups more likely to own an IRA were:

  • whites,
  • males,
  • married individuals, and
  • workers

And the with the highest average balances were:

  • widows and widowers
  • males,
  • non-workers, most likely retirees, and
  • whites.

Further, while both African Americans and Hispanics had low ownership rates, the average account balance of the former group was the lowest of all the races, while that of the latter was closer to the average account balance in the white group.

IRA Owners

About 16% of adult Americans owned an IRA in early 1997, the average balance of which was $27,025 in 1996, and on average, IRA owners made contributions to the account for 8.1 years.

In 1996, 3.9% of adult Americans made a deductible contribution to an IRA, with 66% of these making the maximum contribution of $2,000. Overall, the size of deductible contributions was $1,729.

Odds of Ownership

The likelihood of owning an IRA generally increased with

  • age,
  • monthly income, and
  • education.

However, ownership rate declined among the oldest group in the survey, particularly among those over age 70, whose ownership rate was lower than that of IRA owners ages 35-44 in 1996. Not surprisingly, average account balances increase with age up to this point before decreasing.