Account structure for IRA mutual funds

[Robert Ramsdell]

On Sun, 2006-11-05 at 10:50 -0700, Sean Fulmer wrote:

> 
> My IRA overall has a positive balance due to the value of the funds.
> 
> I think my point of confusion is in the IRA Asset account itself. It
> always has a balance of zero, because anything that goes into it is then
> distributed out to the various mutual funds. Is a $0 account actually an
> asset?

This is normal for a parent account.  In this case the IRA is just a
pass-through.  As a matter of fact, I try never to carry a balance in
parent accounts, I figure that everything should be classified by
allocating to children.  Think of the parent as a folder with files in
it.

For example, I have a 401(k) account with children representing the
securities/funds I own.  Each paycheck my contribution is added to that
account, but then I transfer the money out to the children, so the
parent is always zeroed out.