Payroll Deduction IRA | Retirement | Lord Abbett

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Payroll Deduction IRA

A Payroll Deduction IRA offers employees of a small business an easy and convenient way to save for retirement through a Lord Abbett traditional IRA, Roth IRA, or Coverdell Education Savings Account. 

What is a Payroll Deduction IRA?

A Lord Abbett Payroll Deduction IRA allows employees to automatically deposit a portion of their payinto a traditional IRA, Roth IRA, or Coverdell ESA.

How does a Payroll Deduction IRA work?

  1. Each employee determines account type.
  2. Each eligble employee completes an application and Payroll Deduction Investment Form. 
  3. Amount to be deducted from the employee's paycheck and
  4. Employer transmits employee contributions to Lord Abbett. 


Please contact a Lord Abbett at 888-522-2388 for additional information on establishing a Payroll Deduction IRA.

Who should consider a Payroll Deduction IRA?

  • Business owner that wants to offer a no-cost retirement savings plan
  • Business owner that wants to offer a retirement savings plan with minimal administrative oversight
  • Business owner who wants to offer a retirement savings plan that does not require employer contributions


How does a Payroll Deduction IRA benefit employees?

A Payroll Deduction IRA offers employees several benefits, including:

  • Automatic investment—IRA contributions are made via payroll deductions
  • All employee contributions are 100% immediately vested
  • No account fees 
  • Flexibility—contribution amount can change at any time.


Who is eligible to establish a Payroll Deduction IRA?

The business owner and all employees whohave received compensation.

How much can an individual contribute to a Payroll Deduction IRA?

An employee can contribute up to the maximum allowable limits depending on the account type selected. In 2022, the traditional IRA or Roth IRA maximum contribution limit is $6,000 plus a catch-up contribution of $1,000 for employees age 50 or older. The maximum Coverdell ESA contribution is $2,000.

This information is being provided as general information and is not intended to be legal or tax advice. Lord Abbett does not provide legal or tax advice. 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 2022 or any year afterward. No cost also applies to the Federal Express (FedEx) charges currently absorbed by the B/D to submit paperwork to DST to open a Lord Abbett IRA account. Fund level fees and expenses are still applicable. Please see the current prospectus.

To comply with Treasury Department regulations, we inform you that, unless otherwise expressly indicated, any tax information contained herein is not intended or written to be used, and cannot be used, for the purpose of  (i) avoiding penalties that may be imposed under the Internal Revenue Code or any other applicable tax law, or (ii) promoting, marketing, or recommending to another party any transaction, arrangement, or other matter.

 

How to Open a Payroll Deduction IRA

  1. Complete the writable IRA Application

  2. Send completed application to Lord Abbett Funds Services Center

  3. Feel free to use our Free FedEx shipping option

  4. You’ll receive a confirmation once your IRA is established

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