According to a report released on October 13, 2011 by the Employee Benefit Research Institute, while the percentage of Section 401(k) plan participants and individual retirement account owners grew steadily from 1996 through 2005, by 2009 these numbers had declined slightly.
The percentage of employees between the ages of 21 and 64 participating in individual account 401(k)-type plans grew steadily from 23.3 percent in 1996 to 33.1 percent in 2005, but leveled off slightly in 2009 to 33 percent, according to the report. A similar trend was found in the percentages of workers ages 21-64 who owned IRAs. This percentage grew steadily from 17 percent to 22.9 percent between 1996 and 2005, but declined to 20.8 percent by 2009.The report is titled Ownership of Individual Retirement Accounts (IRAs) and 401(k)-Type Plans, 1996-2009.
The report revealed that as of 2009, with regards to Section 401(k) plan participation:
- The age range of greatest participation was 45-54 (37.9 percent), while the lowest participation age range was age 21-24 (11.2 percent).
- The family income level of greatest participation was $75,000 or more (45.4 percent), while the lowest family income level of participation was $10,000 or less (7.2 percent).
- Employees’ level of participation increased with their level of education, with 50 percent participation among employees holding graduate degrees, but only 9.3 percent of employees participating among those who lacked a high school diploma.
- The percentage of participation was 36.9 percent among whites, 27.8 percent among African-Americans, and 18 percent among Hispanics.
The report also revealed that as of 2009, with regards to IRA ownership:
- The age range of greatest ownership was 55-64 (32.7 percent), while the lowest ownership age range was 21-24 (4.5 percent).
- The family income level of greatest ownership was $75,000 or more (31.5 percent), while the level with the lowest ownership was $10,000-$19,999 (7.2 percent).
- Employees’ levels of ownership increased with their level of education, with 41.3 percent ownership among employees holding graduate decrees but only 3.6 percent ownership among those who lacked a high school diploma.
- The percentage of ownership was 25.6 percent among whites, 10.1 percent among African Americans, and 6 percent among Hispanics.
- The percentage of ownership was higher among men (21 percent) than women (20.5 percent).
The report also found that the average annual contribution to 401(k)-type plans was $4,513 in 2009, up from an inflation-adjusted $4,242 in 1996, but down from $4,864 in 2005. Similarly, the average annual contribution to IRAs was $2,801 in 2009, up from $2,322 in 1996, but down from $2,890 in 2005. 10.14.2011; HRM Partners.