Based on recent “Retirement Trends” survey by Fidelity Investments, 96 percent of Americans saving for retirement don’t have any idea of the current contribution limit for an individual retirement account, with a few guessing as low as $1,000. The fact is that for tax year 2005, IRA contribution limits go up to $4,000 from $3,000 in 2004.

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When it boils down to understanding certain facts about retirements, erroneous interpretations can mean lost opportunities. Present day workers will encounter rising health costs when they retire along with declining pension benefits and a higher cost of living. That's why it's important to save as much as possible, and as early as possible, in tax-advantaged accounts like IRAs.

Getting acquainted with the facts can help disperse universal myths that may discourage many investors from investing wisely in an IRA.

Nearly one-third of Americans in their prime savings years who have not yet opened an IRA account think their 401(k) savings will be sufficient for retirement, according to the Retirement Trends survey. However, Fidelity estimates that retirees will need approximately 80 percent to 100 percent of their pre-retirement income to live comfortably. `But Fidelity calculates that retirees will require approximately 80 percent to 100 percent of their pre- retirement income to live contentedly. An IRA investment today which serves to complement workplace programs offer investors an assurance that their savings will persist to grow and last throughout retirement.

Out of four surveyed non-IRS owners who say they can’t come up with the money for the initial investment, for one of them, opportunities to save all the more for retirement may be discouraging. On the other hand, opening an account even without monthly payments is as uncomplicated as arranging automatic monthly payments via a FidelitySimpleStart IRA.

The younger the investor, the more benefits will be realized if they start to invest early. Almost two-thirds of young adults have begun to investment for retirement before reaching age 30 as reported by the Retirement Trends Survey. Starting to save as early as possible is definitely one of the best ways to prepare for the future.

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