Filling the Savings Gap

Although the United States spends $150 billion a year on tax preferences for pensions, concerns persist about how well the pension system functions. Only half of all workers participate in an employer-based pension plan in any given year, and participation rates in Individual Retirement Accounts (IRAs) are even lower. As a result, many households are approaching retirement without an adequate nest egg. The median defined contribution balance among all heads of households aged fifty-five to fifty-nine in 2001 was only about $10,000.

At this Brookings event, panelists will explore innovative ways to improve retirement security, including changes to the saver’s credit that was part of the 2001 tax legislation and which is set to expire in 2006. The event will also launch the Retirement Security Project, which brings together pension researchers and health care experts to undertake nonpartisan research and outreach aimed at bolstering financial security for America’s aging population by raising retirement savings and improving long-term care insurance products.

The Retirement Security Project, supported by a grant from the Pew Charitable Trusts, can be found on the Brookings website at brookings-edu-2023.go-vip.net/retirementsecurity.