Americans still not taking advantage of IRAs: survey

The need for more education on IRAs is evident, especially among millennials, given that 35% of this young generation say they don’t know enough about these accounts to consider using one, according to a survey released Wednesday.
The TIAA survey also showed a 15 percentage point drop from last year in the number of people across all age ranges who don’t use an IRA but would consider doing so as part of their retirement strategy — from 56% in 2015 to 41% this year.
One of the main reasons people discount this option is because they don’t believe they have enough money to save more than they already do for retirement.
(More: Ed Slott: Who’s keeping track of IRA basis?)
But spending and savings habits may also play a part.
The survey revealed that if offered an extra $5,000 to spend or invest, 30% percent of respondents would spend the money on home renovations, a vacation, technology upgrades or a shopping spree, compared to a mere 6% who would contribute it to an IRA.
“An IRA that includes access to professional financial advice can help Americans think about the big picture when planning for a successful retirement,” said Brian Bohaty, EVP of individual products and services at TIAA.
Though the overall number of people who say they don’t know enough about IRAs has dropped 14 percentage points from last year, to 25%, there has been no increase in the number of people using these accounts.