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Financial Groups, Firms Push for a Biden Order on Retirement Security

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What You Need to Know

  • Signatories include Prudential Financial, TIAA, Edelman Financial Engines and Commonwealth.
  • Social Security and Medicare face financing shortfalls.
  • Rising life expectancies, soaring health care and long-term care costs, and rock-bottom interest rates create new retirement risks.

Financial services firms and policy groups are urging President Joe Biden to issue an executive order to create an inter-agency task force on retirement security as part of his Build Back Better initiative.

“Social Security and Medicare face financing shortfalls, while pension plans have largely disappeared for younger workers,” the 31 organizations, all partners in the Funding Our Future coalition, told Biden in a letter, released Wednesday.

Signatories include the Aspen Institute, UnidosUS, the National Council on Aging, BPC Action, the Employee Benefit Research Institute, Prudential Financial, TIAA, Edelman Financial Engines and Commonwealth.

At the same time, the firms wrote, “rising life expectancies, soaring health care and long-term care costs, and rock-bottom interest rates have created new risks to retirement security.”

The Biden-Harris administration should create an inter-agency retirement security task force “to ensure that this critical kitchen-table issue is not overlooked in the national economic recovery effort and beyond. The proverbial three-legged retirement stool is shakier than ever,” the groups maintained.

“There is no one agency responsible for policy in that [retirement security] area — it’s spread across several,” said Shai Akabas, director of economic policy at the Bipartisan Policy Center. “This letter calls for ongoing coordination as well as a biannual convening and report to the president that would help elevate and facilitate policymaking in this area.”

The inter-agency task force should comprise leaders from the Executive Office of the President, Department of Labor, Consumer Financial Protection Bureau, Social Security Administration, Department of the Treasury, Securities and Exchange Commission and White House Gender Policy Council, the groups recommended.

The executive order, the groups said, should “establish this body and require a biannual report to the president and the American public summarizing its work and priorities.”

The task force should also host “a biannual summit that invites a diverse group of stakeholders and experts to discuss some of the most pressing issues in retirement policy.”

Americans, the letter continued, “simply are not saving enough to cover the gap, with many ending up short of funds later in life: Boston College’s Center for Retirement Research estimates that half of households — including three-quarters of low-income households — are at risk of not being able to maintain their standard of living in retirement.”

EBRI estimates that the aggregate retirement deficit for all households aged 35 to 64, taking into account current Social Security retirement benefits, is $3.83 trillion, the groups said.

“While COVID-19 and the resulting recession have made it even harder for working Americans to achieve secure retirements, the challenge long predates the pandemic and, without your administration’s leadership, will remain after the current crisis passes,” the groups wrote.

“Retirement security must be part of building back better.”

Senate Finance Committee Chairman Ron Wyden, D-Ore., is holding a Wednesday morning hearing on Building on Bipartisan Retirement Legislation: How Can Congress Help?

Pictured: President Joe Biden. (Photo: Bloomberg)