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Guaranteeing Retirement: A Solution Beyond 401(k)

Explore the revolutionary "Beyond the 401(k) Project" proposing guaranteed pensions for secure retirement. Learn how this innovative approach can benefit individuals and various employer types. Discover the financial implications and the potential for a more stable retirement future.

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Guaranteeing Retirement: A Solution Beyond 401(k)

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  1. Pension Reform: Beyond the 401(k)… Teresa Ghilarducci Irene and Bernard Schwartz Professor of Economics New School for Social Research “Beyond the 401(k) Project” – fundedby the Rockefeller Foundation (with assistance from, Daniela Arias, Eloy Fisher, Bridget Fisher, Robbie Hiltonsmith, David Stubbs)

  2. Peoplewantto head for a saferetirement, butweneedtohelpthemgetthere…

  3. Employerpensions are failing…[Munnell (2006); Butrica, Iams & Smith (2003)]

  4. Peoplewant a retirementsolution… • 83% saygovernmentshouldguaranteepensions. • 81% saygovernmentshouldguaranteehealthcare. • 78% saygovernmentshouldraiseminimumwage.

  5. Expensivepension subsidies are failing…

  6. TaxExpenditures can bemadeEffective, Efficient and Fair 6% of taxpayers get 50% of all tax subsidies !!! Current system 401(k)’s tax breaks exceed savings !!!

  7. Whatisthesolution? GuaranteedPensions • 5% of pay is split evenly between the employer and employee. • Everyone gets a $600 tax credit which is adjusted for inflation CONTRIBUTIONS

  8. Whatisthesolution? GuaranteedPensions • Professional Board invests the money in private markets managed by a Guaranteed Retirement Fund. • The guarantee will be revenue-neutral. INVESTMENTS

  9. Whatisthesolution? GuaranteedPensions • GRA’s will provide a yearly payout to the individual adjusted for inflation. • The accumulated funds cannot be withdrawn before retirement. PAYOUT AT RETIREMENT

  10. Whatisthesolution? GuaranteedPensions SAFE AND SECURE RETIREMENT

  11. Retirement Security Under a GuaranteedRetirementAccount(Source: http://www.sharedprosperity.org/bp204/bp204.pdf)

  12. Everybody wins! • Workers with Pensions and 401(k)’s • Wall Street Firms • Private Employers with Pensions and 401(k)’s. • Public Employers with Pensions in Crises. • Workers without Pensions.

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