U.S. Labor Department Releases 2006 National Saver Summit Report

The U.S. Department of Labor has released the final report of the 2006 National Summit on Retirement Savings. The report, entitled Saving for Your Golden Years: Trends, Challenges and Opportunities identifies barriers to retirement savings confronting low-income workers, small business employees, new entrants to the workforce, and individuals nearing retirement. The summit delegates, who met in March 2006, worked on action plans for target populations to raise awareness about retirement planning and offer new programs, policies and ideas to help them adequately save for retirement.

With respect to the challenges faced by workers nearing retirement, delegates came up with a number of suggestions for programs to heighten awareness of possibly inadequate savings, improve older workers’ ability to catch up on savings, take measures to deal with rising healthcare costs, and facilitate phased retirement. Among these were:

• Lifetime Accumulation: Change the tax code that limits tax-deferred annual contributions to retirement
  savings accounts to lifetime limits on contributions.
  
• Change Rules to Reflect Shifting Paradigms: Establish regulations to incorporate some of the best
  features of defined benefit plans—-automatic enrollment, default options—-into defined contribution plans.
  
• Product Bundling: Remove the regulatory impediments to bundling products like annuities and long-term care insurance.
  
• Flexible Work Training (for Managers): Provide training to managers who are willing to hire seniors, focusing on the design, implementation, and appropriate target audiences of flexible work arrangements.
  
• Retiree Health Security: Offer retirees greater financial security by providing protection against two of the biggest threats to retirement security: runaway healthcare costs and gaps in retiree healthcare coverage caused by bankrupt, closed, or
  financially strapped businesses that discontinue or reduce retiree health benefits.

Source: U.S. Department of Labor News Release (September 7, 2006)