By Lisa Barron
The Bipartisan Policy Center has announced the launch of a new Personal Savings Initiative to address the future of Social Security amid evidence that fewer Americans are accumulating sufficient savings for retirement
The initiative will be led by former Senate Budget Committee Chairman Kent Conrad, a Democrat, and Jim Lockhart, former Deputy Commissioner of the Social Security Administration under President George W. Bush.
Millions of Americans are approaching retirement with insufficient savings to maintain their current standard of living, with half of all households nearing retirement age holding less than $12,000 in retirement accounts, the center said in a press release.
As defined benefit pensions become less common and retirees are increasingly relying on a combination of defined contribution savings plans and Social Security benefits
, many people are not saving enough or are not properly investing their contributions, it noted.
“Fundamental changes to federal and private retirement plans have made saving for retirement more complicated and less certain,” Conrad said at a press conference in Washington, D.C., Wednesday.
“Changes in private companies’ retirement plans, complex federal laws and lack of retirement education mean that only 46 percent of all workers reported having access to a workplace retirement savings plan, and only 38 percent were currently contributing, according to a study by the Employee Benefit Research Institute. The Bipartisan Policy Center’s Personal Savings Initiative will devise specific recommendations to begin to remedy these shortcomings.”
Over the next year, the initiative will create a package of realistic policy recommendations to address the future savings needs of Americans and will model the recommendations’ impact on retirement security and the federal budget. The final recommendations will be released in early 2015.
“Social Security plays a central role in retirement. For the elderly in the lower half of income levels, Social Security makes up 85 percent of retirement income,” Lockhart said at the press conference.
“Researchers across the political spectrum have come to the same conclusions - a significant portion of Americans are on track to have a lower standard of living than they do now and many of these households risk running short of money for basic necessities, like health care and housing.”
Conrad and Lockhart will lead a group of commissioners that includes a broad range of political and industry perspectives, including financial experts, business leaders, former elected officials, academics and other key stakeholders. The group will meet for the first time in June.
Originally published on BenefitsPro.com