The Savings Coalition of America advocates policies that encourage and facilitate personal savings and investment, including:
Tax reform that promotes increased personal savings. The Savings Coalition actively supports policies to increase the rate of personal savings in the US, including a campaign to support private savings efforts, and legislative and administrative actions to expand savings opportunities. Particularly, the Savings Coalition closely monitors and address any legislation or regulation arising from comprehensive tax reform efforts and will educate policy makers about the importance of maintaining the flexibility of choosing between pre-tax and post-tax treatment of IRAs.
Simplification of savings and retirement accounts to ease confusion for American savers
The Savings Coalition supports making savings incentives easier for everyone to understand, thereby leading to greater savings through vehicles such as IRAs and Roth IRAs for all income levels. The Savings Coalition supports having IRAs that maintains savings incentives at all income levels, as all American workers need to save for their retirement and an easily understood savings vehicle will allow them to do so.
Changes to the required minimum distributions (RMDs) requirements for IRAs and 401(k)s
The Savings Coalition continues to support the elimination of the overly-complex required minimum distribution (RMDs) from IRAs and 401(k)s, as was recommended in 2001 by the non-partisan Joint Tax Committee. The Savings Coalition believes that, at a minimum, the age trigger for RMD should be raised to reflect substantial gains in life expectancy since the rules were first extended to all types of retirement plans. According to the Social Security Administration (SSA), in 1974, the year in which IRAs were created, the life expectancies for males & females were 68.3 years and 76.0 years respectively. For 2014, SSA projects life expectancies of nearly 76 years for males and over 80 years for females. With such substantial increases in longevity, it is important that the minimum distribution rules should be updated to ensure that American workers are not forced to begin taking distributions prematurely.Additionally, the RMD rules are overly complex. In 2001 the non-partisan Joint Tax Committee recommended an outright repeal of the Minimum Distribution Rules. According to the Committee, the minimum distribution requirements are “widely seen as not only one of the most complex set of rules affecting [IRAs and 401(k) plans], but also one of the most likely to provide a trap for the millions of individuals who participate in such plans.”
Continued access to education and advice for retirement savers The Savings Coalition opposes efforts to scale back the provision of financial education and guidance to American savers through a proposal by the Department of Labor to expand the application of ERISA fiduciary provisions. The Department is expected to re-propose a rule in 2015. Under an earlier proposal it was anticipated that millions of Americans could find financial advice priced at a level that they cannot afford. The Savings Coalition cautions that any proposed rule should provide investor protection without reducing investor access to the affordable retirement advice, education, products and services investors need.
Promoting financial literacy
The Savings Coalition promotes and highlights financial literacy efforts and legislation. Many of our members are actively engaged in promoting and participating in financial literacy and educational programs.