WASHINGTON, D.C. —
At a solutions forum on retirement savings recently, the U.S. Chamber of Commerce and AARP joined together to urge policymakers to act on solutions that will help more Americans build a more secure retirement.
“Unless we reverse current trends, the majority of Americans will face a grim future in retirement,” said Debra Whitman, AARP Executive Vice President for Policy, Strategy and International Affairs. “That is why we are calling today for expanding access for workers to save for retirement and for improving the tax incentives that help encourage them to save. Moving forward, AARP will continue to work to improve financial security for older Americans and for their children and grandchildren.”
“With the unprecedented growth in the number of Americans who are at or near retirement age, it is clear that an emphasis on increasing retirement savings will not only contribute to individual retirement security but also to America’s economic security,” said Randy Johnson, the U.S. Chamber’s senior vice president of Labor, Immigration and Employee Benefits. “The Chamber is committed to preserving the ability of employers to provide flexible and comprehensive compensation to employees and therefore helping to protect the retirement security of America’s workforce. Our changing demographics show that we must act now.”
At the event, AARP and the U.S. Chamber of Commerce released the following principles: Millions of Americans have either no retirement savings at all or far less than they will need for a comfortable retirement. There are many contributing factors to this issue including: lack of access to or non-participation in an employer-provided retirement plan, lack of education about the need for individual retirement saving, or underestimating the amount needed to reach their retirement goals.
In order to address this situation, AARP and the U.S. Chamber of Commerce jointly urge action to:
•Expand access for workers to tax-deferred payroll deduction retirement saving plans at their place of work, while recognizing and minimizing any additional burden these plans place on employers. Payroll deduction retirement saving, especially when combined with automatic enrollment and automatic escalation, has proven to be the most efficient and effective method to increase participation and retirement savings.
•Keep and enhance incentives to save for individuals at all income levels while targeting in particular those low- and moderate-income earners who have fewer opportunities and resources to save. Increasing private retirement saving is critical to both overall economic growth and to the future income security of millions of Americans.
•Increase education efforts regarding the need for working Americans to save sufficient amounts for retirement and how to most effectively do so. Many Americans with the ability to set money aside simply do not save or save far less than they should. Improved and sustained educational efforts can help address that challenge.
These three elements will help increase retirement saving, but the longer no action is taken, the greater the number of today’s workers whose future will be at risk. Together, AARP and the US Chamber of Commerce call on policymakers to act quickly to develop and implement solutions in these three areas that will enable all Americans to build a more secure retirement.