Short title

This Act may be cited as the

Education for Retirement Security Act of 2006

Findings

Congress finds the following: (1)Improving economic and 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. (3)Historically, Americans are living longer than ever before. However, most Americans are retiring before the age of 65. (4)Research suggests that many Americans are not prepared to plan for their retirement and may have to work far longer than they expect in order to be financially secure in retirement. (5)In 2005, only 42 percent of workers or their spouses calculated the amount they needed to save for retirement, down from 53 percent in 2000. (6)Only 53 percent of working Americans have any form of pension coverage. Three out of 4 women aged 65 or older receive no income from employer-provided pensions. (7)The limited timeframe that midlife and older individuals and families have to assess the realities of their individual circumstances, to recover from counterproductive choices and decisionmaking processes, and to benefit from more informed financial practices, has immediate impact and near-term consequences for Americans nearing or of retirement age. (8)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 one's retirement years. (9)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. (10)Financial exploitation is the largest single category of abuse against older individuals and this population comprises more than 1/2 of all telemarketing victims in the United States. (11)The Federal Trade Commission (FTC) Identity Theft Data Clearinghouse has reported that incidents of identity theft targeting individuals older than the age of 60 increased from 1,821 victims in 2000 to 21,084 victims in 2004, an increase of more than 11 times in number.

Definitions

In this Act: (1)

Alaska Native Corporation

The term Alaska Native Corporation has the same meaning as the term Native Corporation under section 3 of the Alaska Native Claim Settlement Act (43 U.S.C. 1602). (2)

Economic and financial education

The term economic and financial education means education that— (A)promotes an understanding of consumer, economic, and personal finance concepts, including— (i)basic economic concepts such as supply and demand and opportunity cost; and (ii)basic financial literacy concepts such as the importance of budgeting and money management, saving, retirement planning, and maintaining good credit; (B)includes information regarding predatory lending and financial abuse schemes; and (C)is based on recognized economic and financial education standards. (3)

Eligible area entity

The term eligible area entity means an entity that is— (A)a State agency, area agency on aging, Indian tribal organization, Alaska Native Corporation, or Native Hawaiian organization; (B)a nonprofit organization with a proven record of providing— (i)services to midlife and older individuals; (ii)consumer awareness programs; or (iii)supportive services to low-income families; or (C)a partnership comprised of 2 or more entities described in subparagraph (A) or (B). (4)

Eligible entity

The term eligible entity means a national organization with substantial experience in the field of economic and financial education. (5)

Midlife

The term midlife, when used with respect to an individual, means an individual aged 45 to 64 years. (6)

Native Hawaiian organization

The term Native Hawaiian organization means any organization that— (A)serves and represents the interests of Native Hawaiians; and (B)has as a primary and stated purpose the provision of services to Native Hawaiians. (7)

Older

The term older, when used with respect to an individual, means an individual aged 65 or older. (8)

Secretary

The term Secretary means the Secretary of Health and Human Services.

Purpose and goals

(a)

Purpose

The purpose of this Act is to promote economic and financial literacy among midlife and older individuals, and to reduce financial abuse and fraud among such individuals, through providing assistance to organizations for economic and financial education programs. (b)

Goals

The goals of this Act are— (1)to increase the knowledge of economic and financial literacy among midlife and older individuals to enable the individuals to make informed financial decisions; and (2)to reduce the amount of financial abuse and fraud among midlife and older individuals.

Grant program to enhance economic, financial, and retirement literacy and reduce financial abuse and fraud among midlife and older Americans

(a)

Program authorized

From amounts appropriated under section 8, the Secretary is authorized to award a grant to a national entity to enable the national entity to carry out the subgrant program for economic and financial education under section 6. (b)

Application

A national entity desiring a grant under this section shall submit an application to the Secretary at such time, in such form, and containing such information as the Secretary may require, including a plan for continuing to carry out the program under this section after the grant expires. (c)

Limitation on administrative costs

A national entity receiving a grant under this section may not use more than 5 percent of the total amount of the grant for each fiscal year for the administrative costs of carrying out the program under this section. (d)

Evaluation

The Secretary shall evaluate the programs that receive grant funds under this section in order to judge the performance of such programs. (e)

Report

For each fiscal year for which grants are awarded under this section, the Secretary shall prepare and submit to Congress a report on the program under this section, which report shall include information from the evaluation under subsection (d) and the evaluations under section 6(e).

Subgrant program to enhance economic, financial, and retirement literacy and reduce financial abuse and fraud among midlife and older Americans

(a)

Subgrants authorized

A national entity that receives a grant under section 5 shall use grant funds to award subgrants to eligible area entities to enable the eligible area entities to deliver economic and financial education programs to midlife and older individuals who reside in local communities, in order to— (1)enhance financial and retirement knowledge among such individuals; and (2)reduce financial abuse and fraud, including telemarketing, mortgage, and pension fraud, and identity theft among such individuals. (b)

Application

An eligible area entity desiring a subgrant under this section shall submit an application to the national entity awarding the subgrants at such time, in such form, and containing such information as the national entity may require, including a plan for continuing the programs assisted with subgrant funds under this section after the subgrant expires. (c)

Award basis

In awarding subgrants under this section, a national entity shall— (1)give special consideration to eligible area entities that are partnerships described in section 3(3)(C); and (2)give priority to programs previously funded by a subgrant under this section that the Secretary judges effective under the evaluation described in subsection (e)(2)(A). (d)

Limitation on administrative costs

An eligible area entity receiving a subgrant under this section may not use more than 5 percent of the total amount of the subgrant in each fiscal year for the administrative costs of carrying out the program under this section. (e)

Evaluation and report

(1)

Establishment of performance measures

A national entity awarding subgrants under this section shall develop measures to evaluate the programs that receive subgrant funds. (2)

Evaluation according to performance measures

Applying the performance measures developed under paragraph (1), a national entity awarding subgrants under this section shall evaluate the programs that receive subgrant funds 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 midlife and older individuals; (C)identify which programs may be replicated; and (D)assess any behavioral change, as well as asset accumulation, made by program participants. (3)

Submission to Congress

For each fiscal year for which a national entity awards subgrants under this section, the national entity shall submit to the Secretary a report containing— (A)a description of the status of the subgrant program under this section; (B)a description of the programs provided with subgrant funds under this section; and (C)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 economic and financial education; and (2)provide training and other related assistance regarding the establishment of economic and financial education programs to eligible area entities awarded a subgrant under section 6. (b)

Application

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

Basis and term

The Secretary shall award a grant under this section on a competitive, merit basis for a term of 3 years.

Authorization of appropriations

(a)

Authorization

There are authorized to be appropriated to carry out this Act, $100,000,000 for each of the fiscal years 2007 through 2010. (b)

Limitation on funds for evaluation and report

The Secretary may not use more than $500,000 of the amounts appropriated under subsection (a) for each fiscal year to carry out section 6(e). (c)

Limitation on funds for training and technical assistance

The Secretary may not use less than 5 percent or more than 10 percent of the amounts appropriated under subsection (a) for each fiscal year to carry out section 7.