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Retirement Planning > Social Security

Petri Proposes Social Security Baby Bond Program

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A member of the U.S. House Education and the Workforce Committee is promoting a new strategy for beefing up federal retirement income insurance funding.[@@]

Rep. Thomas Petri, R-Wis., has introduced a bill, H.R. 1800, that calls for the federal government to contribute $1,000 to a Personal Social Security Investment Account for each child born in the United States.

Parents could add voluntary contributions to the accounts and invest the assets in funds similar to the funds available through federal employees’ Thrift Savings Plan.

Earnings would accrue free of taxes.

Social Security would take money out of the personal accounts to pay Social Security benefits before dipping into Social Security Trust Fund assets, and individuals who accumulated more than enough personal account assets to fund their Social Security benefits would own the excess funds, Petri says in a discussion of the bill published in the Congressional Record.

A taxpayer could get all the excess cash out at once or use the excess cash to buy a lifetime annuity, Petri says.

Putting $1,000 in a newborn child’s personal account and leaving the money alone to grow at the average rate recorded by Thrift Savings Plan assets would provide about $58,000 in inflation-adjusted retirement assets by the time the child reached the future normal retirement age of 67, Petri says.

“This plan would establish a mechanism for reducing the long term fiscal pressures facing Social Security without changing the current benefit structure or diverting payroll taxes from the trust fund,” Petri says.

The Library of Congress has not yet published the text of H.R. 1800, but it plans to publish the text at


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