Short title

This Act may be cited as the

Retirement Security Education Act of 2005

Findings

Congress finds the following: (1)Improving financial literacy is a critical and complex task for Americans of all ages. (2)Low levels of savings and high levels of personal and real estate debt are serious problems for many households nearing retirement. Personal savings rates have fallen to a dangerously low 2 percent. (3)Approximately half of working Americans have any form of pension coverage. Today, just 21 percent of workers have defined benefit coverage and just 27 percent of workers are enrolled in 401(k)s. (4)Because women have longer life expectancies, the number of poor older women is more than twice the number of poor older men. Studies have also found that there is a substantial gender gap in all sources of retirement income including Social Security, pensions, savings and earnings from post-retirement employment. (5)The more limited timeframe that mid-life and older individuals and families have to assess the realities of their individual circumstances, to recover from counter-productive choices and decision-making processes, and to benefit from more informed financial practices, has immediate impact and near term consequences for Americans nearing or of retirement age. (6)Research indicates that there are now 4 basic sources of retirement income security. Those sources are social security benefits, pensions and savings, healthcare insurance coverage, and, for an increasing number of older individuals, necessary earnings from working during retirement years. (7)The Congressional Budget Office has found that about a quarter of baby-boomer households have so far failed to accumulate significant savings and that they appear likely to depend entirely on government benefits in retirement. (8)Over the next 30 years, the number of older individuals in the United States is expected to double, from 35,000,000 to nearly 75,000,000, and long-term care costs are expected to skyrocket. (9)Over the next 25 years, the number of individuals over 65 years of age requiring long term care services is expected to double to approximately 12 million. (10)Fraud against older individuals, including telemarketing schemes, predatory lending, identity theft and Internet fraud has risen dramatically.

Grant program to enhance financial and retirement literacy and reduce financial abuse and fraud among mid-life and older americans

(a)

Authority

The Secretary is authorized to award grants to eligible entities to provide financial education programs to mid-life and older individuals who reside in local communities in order to— (1)enhance and promote knowledge of financial issues, long-term care, and retirement issues among such individuals; and (2)reduce financial abuse and fraud, including telemarketing, mortgage, and pension fraud, among such individuals. (b)

Eligible entities

An entity is eligible to receive a grant under this section if such entity is— (1)a State agency or area agency on aging; or (2)a non-profit organization organized under section 501(c)(3) of the Internal Revenue Code with a proven record of providing— (A)services to mid-life and older individuals; (B)consumer awareness programs; or (C)supportive services to low-income families. (c)

Application

An eligible entity desiring a grant under this section shall submit an application to the Secretary in such form and containing such information as the Secretary may require, including a plan for continuing the programs provided with grant funds under this section after the grant expires. (d)

Limitation on administrative costs

A recipient of a grant under this section may not use more than 4 percent of the total amount of the grant in each fiscal year for the administrative costs of carrying out the programs provided with grant funds under this section. (e)

Evaluation and report

(1)

Establishment of performance measures

The Secretary shall develop measures to evaluate the programs provided with grant funds under this section. (2)

Evaluation according to performance measures

Applying the performance measures developed under paragraph (1), the Secretary shall evaluate the programs provided with grant funds under this section in order to— (A)judge the performance and effectiveness of such programs; (B)identify which programs represent the best practices of entities developing such programs for mid-life and older individuals; and (C)identify which programs may be replicated. (3)

Annual reports

For each fiscal year in which a grant is awarded under this section, the Secretary shall submit a report to Congress containing a description of the status of the grant program under this section, a description of the programs provided with grant funds under this section, and the results of the evaluation of such programs under paragraph (2).

National training and technical assistance program

(a)

Authority

The Secretary is authorized to award a grant to 1 or more eligible entities to— (1)create and make available instructional materials and information that promote financial education; and (2)provide training and other related assistance regarding the establishment of financial education programs to eligible entities awarded a grant under section 3. (b)

Eligible entities

An entity is eligible to receive a grant under this section if such entity is a nonprofit organization organized under Section 501(c)(3) of the Internal Revenue Code with substantial experience in the field of financial education. (c)

Application

An eligible entity desiring a grant under this section shall submit an application to the Secretary in such form and containing such information as the Secretary may require. (d)

Basis and term

The Secretary shall award a grant under this section on a competitive, merit basis.

Sense of congress

It is the sense of Congress that, in providing assistance under this Act, the Secretary should place a high priority on the provision of such assistance to organizations that have demonstrated experience in providing financial education to older women.

Definitions

In this Act: (1)

Area agency on aging

The term area agency on aging has the meaning given such term in section 102 of the Older Americans Act of 1965 (42 U.S.C. 3002). (2)

Financial education

The term financial education means education that promotes an understanding of consumer, economic, and personal finance concepts, including saving for retirement, long-term care, and estate planning and education on predatory lending, identity theft, and financial abuse schemes. (3)

Mid-life individual

The term mid-life individual means an individual aged 45 to 64 years. (4)

Older individual

The term older individual means an individual aged 65 or older. (5)

Secretary

The term Secretary means the Secretary of Health and Human Services. (6)

State agency

The term State agency has the meaning given such term in section 102 of the Older Americans Act of 1965 (42 U.S.C. 3002).

Authorization of appropriations

(a)

Authorization

There is authorized to be appropriated to carry out this Act, $100,000,000 for each of the fiscal years 2006 through 2010. (b)

Limitation on funds for evaluation and report

The Secretary may use to carry out section 3(e) not more than $200,000 of the amount appropriated under subsection (a) for each fiscal year. (c)

Limitation on funds for training and technical assistance

The Secretary shall use to carry out section 4 not less than 5 percent, and not more than 10 percent, of the amount appropriated under subsection (a) for each fiscal year.