In the Nation's Interest
Event Recap: Bipartisan Policy Center’s Policy Forum on Retirement Security
Summer 2014 Intern
Committee for Economic Development
This past July, the Bipartisan Policy Center hosted a discussion on retirement security, an issue that has become a major national concern since the 2008 financial crisis and weakening state of our public retirement programs.
James Poterba, President and Chief Executive Officer of the National Bureau of Economic Research, opened the forum by discussing the problems posed by the current U.S. retirement model. Most notably, while the top quarter of earners benefit from Social Security, pensions and personal savings, over 25% of lower-income retirees are faced with having to rely primarily or solely on Social Security. Living on such limited means makes it nearly impossible for this segment of the population to maintain their pre-retirement lifestyles, consequently being left with no other option than having to substantially downsize.
The forum also included Kristi Mitchem, a senior managing director at State Street Global Advisors, who discussed the lack of understanding many have about the amount of savings actually needed for retirement. She contended that giving employees the option to opt out, rather than opt into, a 401(k) could result in them generating a substantially larger nest egg. Additionally, companies could incorporate the “non-discrimination rule” into their retirement plans, which requires that all workers, regardless of their position within their company, be eligible for the same retirement benefits.
Until long-term, structural changes are made for both current and future retirees, retirement security will continue to take center stage for citizens and lawmakers nationwide.