A Primer on Iras

Boston College CRR-JTF Working Paper No. 7

4 Pages Posted: 31 Aug 2005

See all articles by Alicia H. Munnell

Alicia H. Munnell

Boston College - Center for Retirement Research

Date Written: March 2003


Individual Retirement Accounts (IRAs) now hold more assets than either defined benefit or defined contribution pension plans, but many people do not understand how they work. This Just the Facts reminds readers of the differences between Roth and conventional IRAs and describes their role to date as saving vehicles. This piece concludes that although households hold a lot of money in IRAs, these accounts do not appear to have been major vehicles for new saving. Despite the valuable tax benefits associated with both the conventional and Roth IRAs, people tend to use these accounts mainly as depositories for rollovers from their employer-sponsored plans rather than for new saving.

Keywords: IRA, defined benefit, defined contribution, pension, saving

Suggested Citation

Munnell, Alicia, A Primer on Iras (March 2003). Boston College CRR-JTF Working Paper No. 7. Available at SSRN: https://ssrn.com/abstract=556791 or http://dx.doi.org/10.2139/ssrn.556791

Alicia Munnell (Contact Author)

Boston College - Center for Retirement Research ( email )

Fulton Hall 550
Chestnut Hill, MA 02467
United States
617-552-1762 (Phone)

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