Institute Releases Ad Hoc Survey on SIMPLE IRAs as of June 30, 1999

Washington, DC, September 23, 1999 - The Institute recently surveyed its fund members on trends in SIMPLE IRAs during the period from yearend 1998 to June 30, 1999. (An earlier survey covered the first quarter 1998 and examined Roth IRAs and Education IRAs in addition to SIMPLE IRAs.) The Institute's survey requested SIMPLE IRA data on the number of plans, participants, and assets as of December 31, 1998 and June 30, 1999. Survey results show a 31% increase in the number of plans to 118,000 plans, a 34% increase in the number of participants to about 576,000 accounts, and a 72% increase in the amount of assets held in SIMPLE IRAs during the first six months of 1999, to about $2.8 billion.

In addition, it appears that the SIMPLE IRA continues to be most popular among very small employers, the market for which it was designed. About 90% of employers establishing SIMPLE plans were those with 10 or fewer employees; 98% were those with 25 or fewer employees.

Survey participants were not randomly selected and therefore the results do not necessarily reflect the characteristics of the typical SIMPLE IRA account of mutual funds. In addition, although the majority of survey results represent information covering both yearend 1998 and June 30, 1999, some respondents were unable to provide data for both periods. Survey results represent an estimated 83% of the SIMPLE IRA assets invested in mutual funds as of yearend 1998.