Individual retirement accounts in the United States hold about $4.2 trillion... about 25 percent of all investment assets yet only a small percentage of account holders contribute new money to them, according to a new study released Tuesday by the Investment Company Institute.

The study shows just 9.4 percent of investors in traditional IRA accounts added contributions in 2008, down from the 11.2 percent in 2007. The data used for this study focused on account totals in 2007 and 2008, ICI said.

The IRA was created by Congress in 1974 as a way to set aside a portion of income free of taxes for retirement and as a place of workers to roll over their 401(k) accounts when they leave their jobs, so that they can consolidate various accounts.

The study's author, Sarah Holden, ICI's senior director of retirement and investor research, said about two-thirds of IRA owners have other retirement accounts such as a 401(k) at work and likely contribute to them first.

Scott Drake interviews Sarah Holden for Annuity News Now.

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