Individual Accounts in Other Countries

The International Social Security Association classifies an individual account as "An arrangement in which capital belonging to an individual person accumulated from mandatory or voluntary contributions is recorded so that it may be withdrawn in the case of certain specified future contingencies" (ISSA and INPRS 2003). Many countries have voluntary retirement income plans in addition to the mandatory system. The United States has many examples of such plans. Individual retirement accounts allow workers to contribute a certain amount per year to an individual account with the financial institution of their choice. Employees and sometimes employers contribute to 401 (k) plans, which provide a range of investment choices offered by the employer.