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The Markets July 1, 2010
Roth Expansion Drives Increase in IRA Contributions
Fidelity Investments said it experienced significant year-over-year increases in IRA contributions and new account openings for Traditional, Roth and Rollover IRA accounts during the first four months of the year.
Reported by Rebecca Moore
Fidelity said this growth was partly driven by Roth IRA conversion activity and the use of Roth IRAs as a savings vehicle. Roth IRA account openings rose 89% in 2010 when compared with 2009.
“With income limits now removed for Roth IRA conversions, investors are reexamining the Roth IRA as a potential strategy within their overall retirement savings plan,” said Ken Hevert, vice president, Fidelity Investments, in a press release.
Data for IRA accounts held at Fidelity also showed the number of investors who contributed to their IRAs was up across all account types. Roth and Rollover IRA contributions were up more than 14% and Traditional IRA up more than 6%.
Average IRA contribution amounts increased more than 9% over the same time frame in 2009, to nearly $3,700 in 2010.
Fidelity said it offers several IRA educational tools for investors on Fidelity.com/IRA to help investors navigate market fluctuations, legislative changes and changing needs based on their life stage.