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MONEY SMALL INVESTORS INDEX: SMALL INVESTORS ADD $72 BILLION TO IRAs

MONEY SMALL INVESTORS INDEX: SMALL INVESTORS ADD $72 BILLION TO IRAs
 /ADVANCE/ NEW YORK, April 12 /PRNewswire/ -- In the 12 months leading up to this Wednesday's deadline for filing tax returns, Americans will have poured about $72 billion into Individual Retirement Accounts, according to data gathered for MONEY magazine's Small Investor Index.
 Those 1991-92 contributions will exceed the '90-'91 total by $26 billion and bring Americans' IRA assets to about $648 billion.
 For the first time since IRAs were made widely available in 1982, more than half of all IRA assets are now in mutual funds and self- directed accounts that hold stocks and bonds. Data from the Investment Company Institute show that mutual funds increased their share of all IRA assets from 23.4 percent for the 1990 tax year to 26.1 percent for 1991, and assets in self-directed accounts grew from 21.6 percent of the market to 24.3 percent.
 By contrast, as interest rates on savings accounts plunged, IRA assets in banks, credit unions and savings and loans declined from 44.7 percent to 39.8 percent.
 Among mutual funds, stock funds have increased in popularity, rising from 41 percent to 44.7 percent of IRA holdings, while bond funds have dropped from 29.4 percent to 21.3 percent. Cash parked in money-market funds, despite 4 percent yields, have risen from 28.9 percent to 33.7 percent.
 The biggest losers have been bank certificates of deposit. "People making IRA contributions today are realizing that to earn the high returns necessary to provide for a comfortable retirement, they have to take more risk," says Jennifer Martin, editor of the IRA Reporter in Brainerd, Minn.
 Last week, the Small Investor Index, which tracks the typical individual's holdings, rose $45 to $45,450. Stocks lost $43, while bonds added $81. CDs and money-market funds contributed $14.
 This Last Year % Change from a
 Week Week Ago Week Ago Year ago
 101.05 100.95 92.89 +0.10% +8.78%
 Latest changes for each asset
 % change from a
 Category Index Week Ago Year Ago
 Stocks
 NYSE 99.76 +0.10% +9.47%
 ASE/OTC 104.91 -1.19 +17.55
 Equity funds 101.54 -0.63 +10.35
 Bonds
 Taxable Bonds 100.52 +0.78 +11.76
 Municipals 101.82 +0.69 +10.64
 Bond funds 101.18 +0.59 +12.92
 Short-term assets
 CDs 101.27 +0.09 +5.50
 Cash 101.12 +0.07 +4.68
 Other
 Real estate 96.46 -0.38 -7.14
 Gold 90.82 -2.44 -9.11
 Dec. 27, 1991 equals 100
 Where average small investors have their money now
 Current Year Ago Current Year Ago
 NYSE 22.07% 21.90% Bond funds 5.32% 4.29%
 ASE/OTC 6.97 6.91 CDs 16.55 19.50
 Equity funds 5.19 4.02 Cash 23.12 21.88
 Taxable bonds 12.65 13.13 Real estate 0.76 0.76
 Municipals 6.89 7.08 Gold 0.50 0.54
 Sources: Bank Rate Monitor, IBC/Donoghue's Money Fund Report, the Federal Reserve, Investment Company Institute, Lehman Bros., Lipper Analytical Services, Merrill Lynch, Morgan Stanley Capital International, National Association of Real Estate Investment Trusts, Prudential Asset Management, Standard & Poor's, Robert Stanger & Co., World Gold Council
 -0- 4/13/92
 /NOTE TO EDITORS: This material is also available in printable form from AP GraphicsNet and Access services for graphics and tables (under the file name MoneyIndex) and from PR Newswire for full text./
 /CONTACT: Jordan Goodman of Money, 212-522-3618, or Patti Straus of Money Public Relations, 212-522-2695/


SH -- NY049 -- 7305 04/10/92 14:41 EDT
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Date:Apr 10, 1992
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