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By the numbers: Retirement planning and Roth IRAs

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A nonpartisan Employee Benefit Research Institute research report has data showing that balances of Roth IRAs grew at more than double the rate of traditional IRAs.

For individuals ages 35 and older, the average and median balances for roll-over IRAs were higher than for each of the other plan types, particularly once the account owners reached age 40 and older.

In addition, the report classifies five types of IRAs with three of particular interest for this article:

        1. Traditional IRAs (TOFC),
        2. Roth
        3. Traditional rolled over from other tax-qualified plans (TOFR)

The report shows the distribution of the IRA accounts in the database as of year-end 2012 for the above classified IRA types to be:

    1. Traditional IRA (TOFC) –34.8 percent
    2. Roth – 22.7 percent
    3. Traditional rolled-over from other tax-qualified plans (TOFR) – 28.6 (combined traditional IRAs, 63.4)

Additional findings from the report:

    1. Traditional IRA (TOFC) – 41.8 percent were individual
    2. Roth – 28.1 percent
    3. Traditional rolled-over from other tax-qualified plans (TOFR) – 34.2 percent were individual

For individuals ages 35 and older, the average and median balances for Roll-over IRAs were higher than for each of the other plan types, particularly once the account owners reached age 40 and older.