Investors of all ages are not taking full advantage of the benefits of IRA accounts. This means even younger investors could end up short when they reach retirement age. In a recent survey conducted by TIAA-CREF, 73% of investors between the ages of 18 and 34 were unaware of the full contribution amount allowed annually to an IRA or Roth. Fifty-eight percent had no clue IRA accounts grow on a tax-deferred basis.
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Aspects such as catch-up contributions for people over 50 or that Roth contributions can be withdrawn without penalty under certain circumstances are IRA benefits people are not taking advantage of. The biggest reasons cited were lack of financial education and also lower levels of income.
Women, however, were almost neck and neck with the Boomer segment on making full contributions to their IRAs. Forty-one percent of women made maximum contributions compared to only 34% of men. The survey
had 1007 respondents age 18 and older and was conducted in February 2012.