American Express National Survey Finds Multiple and Duplicate Retirement Accounts Pervasive; Benefits of Consolidation, Real Diversification Not Understood by Most Americans.

Business Editors

MINNEAPOLIS--(BUSINESS WIRE)--Feb. 9, 2004

Almost one half of all Americans own two or more of the same type of retirement accounts, such as a 401k account, a Roth IRA or a traditional IRA, according to an American Express (NYSE:AXP) Personal Economy Survey spotlighting Retirement Savings. The survey also revealed that while three out of every four workers have a 401k account with their current employer, almost one-third have left their retirement assets behind with a former employer.

"Multiple account ownership is becoming more common because fewer and fewer Americans are staying with one company or one career over their lifetime. Yet multiple retirement accounts may be problematic, particularly if they are the same kind of account," said Craig Brimhall, vice president of Wealth Strategies at American Express Financial Advisors. "It is far more difficult and time-consuming to track asset performance, stay diversified, and to manage risk and distributions from your savings if the money is invested in a variety of different retirement accounts."

Conducted in November 2003 by American Express Global Marketplace Insights, results from a national telephone survey of 894 American households with at least one retirement plan in their household, found that slightly more than one-third of all individuals' have three or more retirement accounts, while one out of every six people own five or more accounts.

"In the past, some retirement assets had to be kept separate. But a tax law change in 2001 made retirement savings more portable," said Brimhall. "One of the goals of that legislation was to give investors the flexibility and opportunity to consolidate assets."

Yet, a large majority of those surveyed said they liked having their retirement savings invested in more than one place, demonstrating a lack of real understanding about asset allocation. Brimhall thinks that investors may have a false sense of being well diversified, believing that owning different accounts equates to diversification.

"You could be heavily invested in one or two asset classes or even the same underlying securities and not even know it because you own so many accounts. Keeping your assets in lots of different accounts is like trying to baby sit at five different houses. It's much easier to watch over the kids if they're all in the same backyard."

One startling discovery was that 70% of all households with employer-sponsored retirement accounts (401k /403b /457 plans) mistakenly believe that they pay no fees for the management of these accounts. Every retirement account, including both Roth and traditional IRA's, requires some level of expense for asset management and administrative costs.

Another troubling survey finding revealed that over one-third (35%) of investors spent 1 to 3 hours last year reviewing their retirement accounts, while one quarter spent no time at all on their accounts.

"Not too long ago, it was painful to open our account statements, but the market has been improving, and I can't stress how important it is to actively manage one's retirement future, and that includes reviewing performance, re-balancing and remaining diversified."

Brimhall added, "With so many Americans expected to live well into old age, we need to be more focused on planning and saving for the years ahead. At American Express, we believe that you can't have too much money saved for retirement, but you can have too many retirement accounts."

Additional findings of the Retirement Survey -

-- Over two-fifths of households have less than $50,000 invested

in their retirement accounts.

-- More than 1 in 10 do not know how much money they have saved

for retirement.

-- More than 1 in 10 can not identify the specific type of

retirement account they own (i.e., IRA's, SEP's, 401k's).

-- 72 % of American's own a 401k account with their current

employer. 32% have 401k accounts with a prior employer.

American Express Financial Advisors is one of the nation's leading financial planning companies. It is part of the American Express Financial Corporation, which currently owns or manages more than $312 billion in assets. Through a network of more than 10,500 financial advisors and its online brokerage, the company provides financial advice, long-term financial planning and high quality financial products to more than 2.7 million clients throughout the United States.

American Express Financial Advisors Inc. Member NASD. American Express Company is separate from American Express Financial Advisors Inc. and is not a broker-dealer.