The Employee Retirement Income Security Act (ERISA) passed the responsibility of retirement savings from the employer to the employee. IRAs were created in 1975 to provide individuals a chance to direct where their retirement funds were invested. Rather than distinguishing which investments are allowed, the IRS code instead identifies which investments are not permitted under these laws. Only two types of investments are excluded under ERISA and IRS Codes:
- Life Insurance Contracts
- Collectibles such as works of art, rugs, jewelry, etc.
IRS Code Sec. 401 IRC 408(a) (3)