Initiative will work to establish principles for a visionary retirement income system
SEIU partnered with The Economic Policy Institute (EPI), the National Committee to Preserve Social Security and Medicare and the Pensions Rights Center to launch Retirement USA, an initiative working for a new retirement system that, along with Social Security, will provide universal, secure, and adequate income for future retirees.
Why do we need the Retirement USA Initiative?
"Only half of full-time workers have a retirement plan through their employer, and coverage is much lower for part-time workers. Participating in a plan doesn't mean a worker is adequately preparing for retirement. The median 401(k) account balance was only $25,000 in 2006---$40,000 for workers approaching retirement age. In other words, half of those who had a 401(k) were nearing retirement with less than $40,000 in their account.
"Account balances have fallen by a third since late 2007, leaving many older workers unable to retire just as our economy is shedding millions of jobs. The failure is broad and deep. It's not just a few people falling through the cracks: most of us are already in the ravine. In the private sector, only two in 10 of us have a secure pension. Three in 10 have only a 401(k) or similar savings plan-and the rest of us are totally out of luck."
The Retirement USA principles will be used by SEIU and its partner organizations in this initiative as a framework for evaluating how well proposals would fulfill the goals of universal coverage, and secure and adequate income. The principals would include concepts such as:
- Pooled assets that are professionally managed;
- Shared responsibility among employers, employees and the government;
- Payouts only at retirement;
- Benefits that could move with you even if you change jobs
"The financial crisis and the economic recession have shone a spotlight on the inadequacies of today's system," said Stephen Abrecht, Director of Benefits and Capital Stewardship for SEIU. "The time to act is now."
Karen Ferguson, director of the Pension Rights Center, has invited others to submit proposals for a new system, which will be examined at the fall conference. Proposals will be posted on the Retirement USA web site at www.retirement-usa.org.