Contributions to personal retirement accounts have surged since the Great Recession hit in 2007, according to a study by Fidelity Investments released Tuesday, August 14.
Boston-based Fidelity, one of the country’s largest managers of retirement funds, looked at contributions made to the company’s individual retirement accounts from 2007 through 2011 and found double-digit percentage increases for all age groups.
People in their 20s saved less than any other age group, but they still put an average of $3,210 in IRAs last year, an increase of 12.9 percent from 2007. Those in their 40s put an average of $3,610 in an IRA last year, up 14.1 percent from 2007.
Those closest to retirement put away the most. The average contribution for people in their 60s was $4,690 last year, more than any other age group and a 13.4 percent increase from 2007.
One likely factor behind the rise in IRA contributions is that people are allowed to put more money in IRAs. In 2007, the maximum IRA contribution was $4,000, according to the Internal Revenue Service. In 2011 and 2012, the maximum annual contribution is $5,000 for a person under age 50. People 50 years old and over can deposit as much as $6,000.
Americans also began spending less and saving more after their finances were battered by a recession and subsequent financial crisis in 2008. Economist date the most recent recession from December 2007 to June 2009.
Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.