By Dan Berman
The U.S. Treasury is strongly considering offering bonds to help workers whose companies don’t offer retirement plans
save for their later years.
The bonds are on the front burner of ideas, Assistant Secretary Mark Iwry told attendees of the Women’s Institute for a Secure Retirement annual symposium in Washington, D.C.
He added that they would have tax benefits similar to IRAs and that when enough money was saved via the bonds, those dollars could be rolled into an IRA
Only full-time employees whose employers offered no retirement savings plans would be eligible to buy the bonds outlined by Iwry, whose full title is assistant secretary (tax policy) for retirement and health policy.
Iwry said the Treasury would not need the approval of Congress to sell the bonds, which would be purchased through automatic payroll deductions.
The bonds would not be the first issued by the Treasury to help Americans plan for retirement
. U.S. Individual Retirement Bonds were available from 1975 to 1982.
Purchasers could hold them until they turned age 70½. There was a $1,500 annual cap on purchasing the savings bonds. A $500 bond purchased in 1982 would have a redemption value of $8,003.80 this month.
Others have called for the Treasury to issue bonds that would offer workers a secure place to invest after they reach retirement age.
One such plan was supported in a recent op-ed by Kermit Zeig Jr., professor emeritus of finance and investments at the Florida Institute of Technology.
Zeig, in the Washington Post this summer, said such bonds should guarantee bondholders could redeem their bonds for full face value at any time. He also said interest rates should be reset quarterly to ensure the highest interest rates were paid.
Originally published on BenefitsPro.com