Tax reform will be a top priority for Congress in 2013, Bob Reynolds, CEO of Putnam Investments said Wednesday, but retirement planning officials and average Americans need to press lawmakers to put reforming Social Security on top of their list as well.
“It’s up to us to change the politics” on the issues of Social Security and retirement security, Reynolds told attendees at a retirement security benefit forum in Washington, which was sponsored by the Financial Services Roundtable. “We should engage in a full debate [with lawmakers] on ways to make Social Security solvent.”
Reynolds said President Obama, Mitt Romney and congressional candidates of both parties should support the bipartisan Sense of Congress Resolution that would ensure that current tax incentives for retirement savings be retained in any reform of the tax code, and that they should discuss retirement security in this year’s campaign.
“Our political leaders should be asked specifically what they plan to do to sustain and expand personal savings incentives,” Reynolds said. “They should also tell us what specifically they will do to restore Social Security solvency for the long term. This is a debate that America needs, and given the increasingly loud ticking of the clock, this is the year for it.”
Added Reynolds: “There are serious, bipartisan compromises that could make Social Security solvent now. Delay would only make reform more painful.”
Steve Bartlett, president and CEO of the Financial Services Roundtable, told AdvisorOne during the event that this year Congress has once again “ignored” providing a remedy for Social Security’s solvency. Congress, he said, has mistakenly identified retirement savings as a “tax expenditure” when it’s a “tax deferral.”
Reynolds warned in his speech that there’s a “very real risk” that policymakers “could severely undercut incentives for 401(k)s, IRA’s and other savings vehicles in the course trying to reduce federal deficits.”