A recent Schwab survey says 60% Gen-Xers don’t have an IRA. I read it in Schwab’s On Investing magazine. It’s also reported on ItsaSurvey.com:
“Schwab surveyed over 500 Americans between the ages of 25 and 40 — a range that generally overlaps with the so-called Generation X — regarding finances and retirement.
“While more than eight in 10 of those born into Generation X are taking some sort of action to save for retirement, only 40 percent of those who are saving have an IRA. Those who do not have an IRA say they don’t need one, don’t have enough money to fund one, or believe the accounts are too complicated.”
If you are a Gen-Xer with an IRA, congratulations, you did better than 60% of your peers. If you don’t have an IRA, make no excuses, because
1. You need one. You are saving in a 401(k) or 403(b), right? Right? The 401(k) or 403(b) is set up by your employer. Many plans have higher expenses and limited investment choices. An IRA is something you have complete control over. You can have the lowest expenses and the best investment choices.
2. It doesn’t take much money to fund one. Save up $1,000 and you can open an IRA with the best mutual fund company Vanguard in the best mutual fund for investing less than $3,000. Don’t have $1,000? For as little as $100, you can still do pretty well with an AARP fund. See my previous post on investing a small amount.
3. The accounts are not complicated at all. Pick the Roth IRA if you are not sure, unless your income is too high.
There you have it. You, too, can have an IRA. Everybody should have one.