Grassley advanced his legislation titled SAVER -- Savings Are Vital to Everyone's Retirement -- through Congress this fall as chairman of the Senate Special Committee on Aging. SAVER directs the U.S. Department of Labor (DoL) to conduct an on-going public education campaign on saving for retirement. This campaign will include several initiatives, including public service announcements, public meetings and the creation and dissemination of educational materials. Grassley said the bill also provides for a bi-partisan National Summit on Retirement Savings which will be held at the White House during the summer of 1998. This summit is intended to help raise the profile of the need for personal savings and identify barriers to savings and pension formation.
"The retirement savings problem is two-fold," Grassley said. "First, there is the lack of adequate savings. Second, there is a lack of understanding about the amount of money people must save in order to retire comfortably. My bill is designed to help people in Iowa and across the country focus on savings for retirement. It will give them the tools to determine how much they need to save. Education has proven to be a powerful motivator for people to think about their retirement savings. SAVER should be an important first step in helping the baby boomers prepare for retirement."
The Grassley bill was co-sponsored by Sens. John Breaux, who serves as ranking member on the Special Committee on Aging, Bob Kerrey, Jon Kyl, Chuck Hagel, Tim Hutchinson, Chuck Robb, Susan Collins, and Thad Cochran.
Grassley said, "Personal savings are a necessary and vital component of preparing for retirement. And it's troubling that at the same time surveys show declining confidence in the future of Social Security, we also see a substantial drop in the personal savings rate. This could impair people's ability to retire in a manner they hope." A Merrill Lynch survey of non-retired workers age 45 to 64, found a drop of 6 percent from 1988 to 1992 alone.
Protecting pensions, another key component of retirement income security, also has been a priority for Grassley during the last year. In June, Grassley conducted a hearing of the Special Committee on Aging to address the fact that pension miscalculations have tripled in the last 10 years. According to the Pension Benefit Guarantee Corporation (PBGC), at least eight percent of those receiving pensions today could be underpaid. Some pension advocates estimate the underpayment rate could be as high as 20 percent.
After his June hearing, Grassley introduced legislation to help pension participants and beneficiaries. The first Grassley bill -- the Pension Counseling and Assistance Act of 1997 -- would re-establish funding for pension counseling projects across the country and set-up an 800 number to coordinate information available from the three federal government agencies that deal with pension issues, the DoL, the PBGC and the Internal Revenue Service.
The second Grassley bill would help pension plan participants keep track of their pension benefits. The Pension Tools Act of 1997 would encourage workers to be more proactive in ensuring their pensions are accurate and help workers resolve conflicts with employers.
Earlier this month, Grassley successfully urged the PBGC to amend its overpayment collection process to make its policy fair to beneficiaries when overpayments are recouped. In response to Grassley's request, the PBGC now will stop recouping money when the total amount collected equals the amount of the overpayment.
