The Senate Special Committee on Aging held a hearing on Wednesday, June 16, on the issue of retirement and lifetime income. Entitled “The Retirement Challenge: Making Savings Last a Lifetime” it specifically it looked into the decisions defined contribution plan participants must make to ensure they have secure retirement income. Administration, expert, and industry witnesses were asked how best to provide more Americans with a choice of a lifetime income options at reasonable cost.
Committee chairman Senator Herb Kohl (D-Wisconsin) mentioned possibly drafting legislation to make it easier for employers to offer lifetime income options to workers. However, compelling Americans to purchase some sort of annuity plan, as was rumored, is not something Kohl or the committee supports, the senator said.
Kohl stressed that while annuities may be the right fit for some retirees, they can also be highly complex and, in the retail market, they have often been associated with aggressive sales tactics. In 2007, the Aging Committee began examining some of the questionable practices used by so-called senior financial investment specialists in order to gain access to the retirement savings of older Americans. Many seniors targeted by unscrupulous salesmen have lost their life savings because they were steered toward investment instruments that were unsuitable for them, given their retirement needs and life expectancy.