©2006 Investment Company Institute. All rights reserved. Information may be abridged and therefore incomplete.
Communications from the Institute do not constitute, and should not be considered a substitute for, legal advice.
[20078]
May 26, 2006
TO: PENSION COMMITTEE No. 20-06
PENSION OPERATIONS ADVISORY COMMITTEE No. 19-06
RESEARCH COMMITTEE No. 7-06
RE: INSTITUTE RELEASES AD HOC SURVEY OF SIMPLE IRAs AS OF DECEMBER 31,
2005
The Institute recently surveyed certain of its members in a continuing effort to track
developments in the SIMPLE IRA market.1 The Institute’s survey requested SIMPLE IRA data on the
number of plans, number of plan participants, and value of the mutual fund assets as of June 30, 2005
and December 31, 2005.
Survey respondents indicate that, between June 30, 2005 and December 31, 2005, the
number of SIMPLE IRA plans increased 4 percent, the number of participants rose 5 percent,
and SIMPLE IRA assets invested in mutual funds were up 15 percent. Based on our survey
results, the SIMPLE IRA continues to be most popular among very small employers. Most
SIMPLE IRA plans have 10 or fewer participants.
Survey results are based on the responses of 24 firms, representing about three-quarters of the
$26 billion of SIMPLE IRA assets invested in mutual funds at year-end 2004.2 Note that the survey
respondents are not randomly selected and therefore the survey results do not necessarily reflect the
characteristics of the typical SIMPLE IRA account invested in mutual funds.
Highlights of the survey results are as follows:
1 The Institute has conducted 14 earlier surveys. For the most recent previous survey, see Institute Memorandum [#19220] summarizing
June 30, 2005 survey results, dated October 5, 2005. Note the number and composition of survey respondents change over time and the
newest survey results represent a complete and consistent time series that reflects revisions to earlier data.
2 For data on IRA assets invested in mutual funds, see the Investment Company Institute, “Mutual Funds and the U.S. Retirement
Market in 2004,” Fundamentals, Vol. 14, No. 4, August 2005 (available on ICI’s website at: http://www.ici.org/pdf/fm-v14n4.pdf) and
“Appendix: Additional Data on Mutual Funds and the U.S. Retirement Market in 2004,” Fundamentals, Vol. 14, No. 4A, August 2005
(available on ICI’s website at: http://www.ici.org/pdf/fm-v14n4_appendix.pdf).
2
I. SIMPLE IRA plans: Survey results indicate, as of December 31, 2005, there were approximately
434,700 SIMPLE IRA plans, an increase of 4 percent in the second half of 2005. Estimates for
previous time periods are shown in the top panel of the chart attached.
II. SIMPLE IRA participants: Survey results indicate, as of December 31, 2005, there were
approximately 1,947,100 SIMPLE IRA participants. The number of SIMPLE IRA participants
increased 5 percent in the second half of 2005. Estimates for previous time periods are shown in
the lower panel of the chart attached.
III. Size of SIMPLE IRA plans: For those respondents who were able to provide the data, as of
December 31, 2005, about 90 percent of the SIMPLE IRA plans had 10 or fewer participants.
Approximately 99 percent of the SIMPLE IRA plans had 25 or fewer participants.3 On average,
there were 4.5 participants per plan in December 2005.
If you have any questions or comments concerning the survey, please call me at (202)
326-5915.
Sarah Holden
Senior Economist
Research Department
Attachment (in .pdf format)
3 The Institute’s previous ad hoc surveys showed similar distributions regarding plan size.