NEWS RELEASE

June 25, 2007
PR-07/15
For additional information:
202-289-6700
Jason Hammersla
202-289-6700


Council commends 'save for retirement' resolution

Personal savings critical for Americans to achieve 'safe and sound' financial security

WASHINGTON, D.C. — "Three years ago, the Council set forth a long-term strategic plan that included the goal of raising Americans' retirement savings to 15 percent of disposable income by 2014," said American Benefits Council President James A. Klein today. "Since then, the personal savings rate has gone in the wrong direction, plunging into negative territory." Klein's comments came in anticipation of the House of Representatives vote on the resolution H.Res 507, supporting the goals and ideals of National Save for Retirement Week. A Senate resolution, S.Res 240, has also been introduced.

According to the U.S. Department of Commerce's Bureau of Economic Analysis, the savings rate as a percentage of disposable personal income has dwindled from 2 percent in 2004 to -1 percent in the first quarter of 2007.

"This is simply unacceptable for Americans who will need to save more to achieve a secure and healthy retirement," Klein said. "That is why we applaud the effort of Senators Gordon H. Smith (R-OR) and Kent Conrad (D-ND) and Representatives Allyson Schwartz (D-PA) and Sam Johnson (R-TX) to declare the week of October 21, 2007 'National Save for Retirement Week.' We are also hopeful that Congress will pass legislation authorizing a permanent Savings for Retirement month," Klein added.

The Council's long-term strategic plan, "Safe and Sound: A Ten-Year Plan for Promoting Personal Financial Security," Included a number of recommendations aimed at increasing personal savings, some of which are already taking shape. "The passage of the Pension Protection Act in 2006 implemented a number of our recommendations, including permanency of increased contribution levels for IRAs and defined contribution plans and enhancement of the Savers tax credit for low-income individuals," Klein said.

"Much more can still be done. Defined contribution plans, such as 401(k) programs, are often challenged by onerous regulations and litigation, and the Council still believes that, for many, employer-sponsored defined benefit pension plans are an essential component of retirement security," Klein said. "It is our hope that a national 'Save for Retirement Week' will not only encourage Americans to save more of their hard-earned money, but also give lawmakers the opportunity to make saving for retirement easier for everyone."

To arrange an interview with Klein or Lynn Dudley, Council vice president, retirement policy, please contact Jason Hammersla, Council director of communications, at jhammersla@abcstaff.org or by phone at (202) 289-6700.

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The American Benefits Council is the national trade association for companies concerned about federal legislation and regulations affecting all aspects of the employee benefits system. The Council's members represent the entire spectrum of the private employee benefits community and either sponsor directly or administer retirement and health plans covering more than 100 million Americans.