Traditional IRA Eligibility

   You are eligible to establish a Lord Abbett IRA if:

Regardless of income or plan participation, everyone can have an IRA.

Many individuals believe being covered by a qualified retirement plan or earning above a certain income makes them ineligible to accumulate funds for retirement via an IRA contribution. Yet, that's not true. The fact is, as long as you have earned income and are under age 70½, you can contribute to an IRA.³ Whether or not these traditional IRA contributions can be deducted on your federal income tax return is a function first of retirement plan participation followed by marital status and income.

Provided you and your spouse, if married, are under age 70½ and are not covered by a retirement plan, each of you may make a federal income tax-deductible⁴ IRA contribution up to $5,500 per year as long as there is earned income equal or greater than the contributions. The investment amount jumps to $6,500 if the individual receiving the contribution is age 50 or older at any time during the calendar year to which the IRA contribution is attributed.

If you are single individual and covered by an employer sponsored plan, you can fully deduct your Lord Abbett IRA contribution if your income is below $58,000 in 2012 ($59,000 in 2013). A partial deduction is available if your income is above $58,000, but does not exceed $68,000 ($59,000 to $69,000 in 2013). These income limits generally increase annually .

Once qualified plan participation extends to either you or your spouse, the eligibility rules change. For 2012 contributions, couples filing jointly, where only one spouse is covered by an employer sponsored retirement plan, the spouse not covered may deduct the full Lord Abbett IRA contribution if the couples' joint income is less than $173,000. Once joint income exceeds $173,000, but does not exceed $183,000 a partial deduction is allowed. Once joint income exceeds $183,000, no deduction is allowed. These income limits increase to $178,000 and $188,000, respectively, regarding any contribution made for calendar year 2013.

If an individual is married and both spouses are covered by an employer-sponsored plan during 2012, fully deductible traditional IRA contributions are permitted if joint income is less than $92,000. A partial deduction is available if the couples' joint income is above $92,000, but does not exceed $112,000 and no deduction if income exceeds $112,000. (These limits increase to $95,000 and $115,000 for 2013.)

The deduction limits are summarized in the following table:

If filing status is...	And modified Adjusted Gross (AGI) 5 Income is...	Then the investor may take...
Single or head of household	$58,000 or less ($59,000 in 2013)	A full deduction
	More than $58,000 but less than $68,000 ($59,000 to $69,000 in 2013)	A partial deduction
	$68,000 or more ($69,000 in 2013)	No deduction
Married filing jointly or qualifying widow(er) and both covered by a plan	$92,000 or less ($95,000 in 2013)	A full deduction
	More than $92,000, but less than $112,000 ($95,000 to $115,000 in 2013)	A partial deduction
	$112,000 or more ($115,000 in 2013)	No deduction
Married filing jointly and one covered by a plan	Less than $173,000 ($178,000 in 2013)	A full deduction for spouse not covered
	More than $173,000, but less than $183,000 ($178,000 to $188,000 in 2013)	Partial deduction for spouse not covered
	More than $183,000 ($188,000 in 2013)	No deduction

Consider a Lord Abbett IRA if any of the following apply:

¹ A Simplified Employee Pension Plan, commonly known as a SEP-IRA, is a retirement plan specifically designed for self-employed people and small-business owners. When establishing a SEP-IRA plan for a business, eligible employees and owners establish their own separate SEP-IRA; employer contributions are then made into each eligible employee's SEP-IRA.

² A SIMPLE IRA plan is an IRA-based plan that gives small-business employers a simplified method to make contributions toward their employees' retirement and their own retirement. Under a SIMPLE IRA plan, employees may choose to make salary reduction contributions and the employer makes matching or non-elective contributions. All contributions are made directly to an Individual Retirement Account (IRA) set up for each employee (a SIMPLE IRA). SIMPLE IRA plans are maintained on a calendar-year basis.

³ Traditional IRA contributions, plus earnings, interest, dividends, and capital gains may compound tax-deferred until withdrawn as income. Amounts withdrawn from traditional IRA plans are generally included as taxable income in the year received and may be subject to 10% federal tax penalties if withdrawn prior to age 59½, unless an exception applies. Investing involves risk, including the possible loss of principal.

⁴ An item or expense, such as an IRA contribution, which, when subtracted from adjusted gross income, reduces the amount of income subject to tax.

⁵ Adjusted gross income includes wages, interest, capital gains, income from retirement accounts, and alimony paid to the taxpayer-adjusted downward by specific deductions (including contributions to deductible retirement accounts and alimony paid by the taxpayer); but not including standard and itemized deductions.

Lord Abbett will waive (or otherwise pay) the yearly $10.00 custodial fee that would be charged each year on an ongoing basis to every new IRA account and, therefore, will not assess a custodial account fee in 2013 or any year afterward. Fund level fees and expenses are still applicable. Please see the current prospectus.