Retirement Plan Assets Concentrated in Higher Income Families

EBRI’s May 2010 Notes said only 1.2% of individual account retirement plan assets were owned by families with family income below $20,000, and 15.1% were owned by families with incomes of $100,000−$149,999. Meanwhile, nearly half of individual retirement plan assets (49.9%) were owned by families with incomes of $150,000 or more. 

Families in the top 10 percentile of net worth owned 59.6% of individual account retirement plan assets, compared with 0.5% of those in the bottom 25% of net worth.  

In addition, EBRI’s analysis of the Federal Reserve’s Survey of Consumer Finances found approximately 70% of the employment-based retirement plan assets in 2007 were held by families headed by individuals ages 45−64. The largest concentration of IRA and Keogh assets were held by families with heads in the next oldest age group (ages 55−74), who own just over 60% of these assets.   

EBRI said the concentration of these IRA/Keogh assets in the accounts of older individuals is largely a result of rollovers from employment-based retirement plans, after retirement or job change.   

Two percent of individual account retirement plan assets were owned by families headed by individuals without a high school diploma, while the share for families with a head having only a high school diploma was 12.2%. Approximately 75% of individual account retirement plan assets were owned by families whose head was a college graduate.   

In addition, the data showed 89.3% of individual account retirement plan assets were held by families headed by white, non-Hispanic individuals.