Accessibility links

Breaking News

Bush Suggests New Retirement Plan - 2002-02-28

President Bush says American workers need to save more money for their retirement. The president wants to change the way employers and employees handle their retirement accounts.

With Americans living longer than ever, President Bush says they need to start saving more money to cover longer, more active retirements. As older Americans prepare for what he calls "decades of enjoyment and ambition," the president says they must pay more attention to the changing needs of their retirement accounts.

"The choices seniors make in retirement should not be limited by arbitrary dates or obsolete stereotypes. Increasingly the choices of seniors will only be limited by two things the state of their health and the state of their savings," Bush said.

As medicine increases the length of life, Mr. Bush says adequate savings must increase the options people have for those longer lives. Americans are saving too little, he says, often dangerously too little.

In addition to encouraging personal savings, the president wants people in the federal social security system to be able to invest a portion of those funds in the stock market.

Mr. Bush told a conference on retirement savings that he also wants to better protect worker pensions by changing the rules governing the way businesses handle their retirement accounts.

Mr. Bush says workers should be allowed to sell company-contributed stock in their retirement plans after just three years. Most companies make employees wait longer, some until they have reached the age of 50.

The president also wants corporate executives bound by the same restrictions they impose on their workers regarding "blackout" periods during which people may not change their retirement accounts.

Mr. Bush wants a 30-day notice before the start of any blackout period to give workers greater freedom to tailor their investments to changing market conditions. "We need action to give workers the right to put their savings, to put their eggs in more than one basket," he said.

Mr. Bush wants employees to receive quarterly updates about their retirement accounts and have better access to investment advice.

Some 42 million Americans have corporate retirement accounts with a total of almost $3 trillion in assets. Mr. Bush says his plan is meant to protect employees who have worked hard and saved all their lives, so he says they will not have to risk losing everything if their company fails.