Financial advisors can not only help investors understand individual retirement accounts, but they can also boost regular contributions to these retirement planning vehicles.

Just-released research by the LIMRA Secure Retirement Institute found that 41% of Americans own a traditional IRA or a Roth IRA, but of those who don’t own an IRA, almost half, or 46%, felt they did not understand how they work.

The biggest obstacle preventing American consumers from investing in an IRA is lack of knowledge, according to LIMRA.

Yet, it is interaction with an advisor or financial services company that bumps up the chances that an IRA holder will make regular contributions, according to LIMRA’s findings.

A little over one-third of IRA owners regularly contribute to their accounts, but of those that do, more than half, or 53%, did so in concert with a financial advisor or other investment professional. In fact, 43% of consumers with a Roth IRA started it on their financial advisor’s recommendation, although the percentage is much lower, at 23%, for traditional IRA owners, according to LIMRA.

LIMRA says that a little over a third, or 34%, of all Americans think they are knowledgeable about IRAs — 42% of men and 27% of women..

The limit on annual contributions to IRAs, whether traditional or Roth, increased to $6,000 from $5,500 under a 2018 action from the Internal Revenue Service.

According to the LIMRA survey, traditional IRAs are more popular with older Americans than younger ones, with 48% of those age 73 and older owning an IRA, compared with 30% of baby boomers, Gen Xers and millennials combined.

Roth IRA ownership tends to hover at or under 20% for all age groups, LIMRA found.

Another important factor in Roth IRA owners’ decisions — cited by 3 in 10 respondents — is the desire for having a mix of pre- and post-tax retirement savings. Roth IRAs represent one of the only types of accounts where withdrawals of earnings (under specified circumstances) are not taxed.

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