[Senate Hearing 116-552]
[From the U.S. Government Publishing Office]


                                                       S. Hrg. 116-552

                   FINANCIAL SECURITY IN RETIREMENT:
                          INNOVATIONS AND BEST
                      PRACTICES TO PROMOTE SAVINGS

=======================================================================

                                HEARING

                               BEFORE THE

                       SPECIAL COMMITTEE ON AGING

                          UNITED STATES SENATE

                     ONE HUNDRED SIXTEENTH CONGRESS


                             FIRST SESSION

                               __________

                             WASHINGTON, DC

                               __________

                            FEBURARY 6, 2019

                               __________

                           Serial No. 116-02

         Printed for the use of the Special Committee on Aging
         
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        Available via the World Wide Web: http://www.govinfo.gov
        
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                    U.S. GOVERNMENT PUBLISHING OFFICE                    
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                       SPECIAL COMMITTEE ON AGING

                   SUSAN M. COLLINS, Maine, Chairman

TIM SCOTT, South Carolina            ROBERT P. CASEY, JR., Pennsylvania
RICHARD BURR, North Carolina         KIRSTEN E. GILLIBRAND, New York
MARTHA McSALLY, Arizona              RICHARD BLUMENTHAL, Connecticut
MARCO RUBIO, Florida                 ELIZABETH WARREN, Massachusetts
JOSH HAWLEY, Missouri                DOUG JONES, Alabama
MIKE BRAUN, Indiana                  KYRSTEN SINEMA, Arizona
RICK SCOTT, Florida                  JACKY ROSEN, Nevada
                              ----------                              
            Sarah Khasawinah, Majority Acting Staff Director
                 Kathryn Mevis, Minority Staff Director
                         
                         
                         C  O  N  T  E  N  T  S

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                                                                   Page

Opening Statement of Senator Susan M. Collins, Chairman..........     1
Opening Statement of Senator Robert P. Casey, Jr., Ranking Member     3

                           PANEL OF WITNESSES

Hon. Gene L. Dodaro, Comptroller General of The United States, 
  Washington, D.C................................................     5
John Scott, Retirement Savings Project Director, The Pew 
  Charitable Trusts, Washington, D.C.............................     6
Denis St. Peter, President and Chief Executive Officer, CES, 
  Inc., Brewer, Maine............................................     8
Linda K. Stone, Fellow Volunteer, Women's Institute for a Secure 
  Retirement (WISER), Bryn Mawr, Pennsylvania....................     9

                                APPENDIX
                      Prepared Witness Statements

Hon. Gene L. Dodaro, Comptroller General of The United States, 
  Washington, D.C................................................    35
John Scott, Retirement Savings Project Director, The Pew 
  Charitable Trusts, Washington, D.C.............................    79
Denis St. Peter, President and Chief Executive Officer, CES, 
  Inc., Brewer, Maine............................................    89
Linda K. Stone, Fellow Volunteer, Women's Institute for a Secure 
  Retirement (WISER), Bryn Mawr, Pennsylvania....................    96

                       Statements for the Record

The Bipartisan Policy Center's Commission on Retirement Security 
  and Personal Savings...........................................   105

 
                   FINANCIAL SECURITY IN RETIREMENT:
                          INNOVATIONS AND BEST
                      PRACTICES TO PROMOTE SAVINGS

                              ----------                              


                      WEDNESDAY, FEBRUARY 6, 2019

                                       U.S. Senate,
                                Special Committee on Aging,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 9:30 a.m., in 
Room 562, Dirksen Senate Office Building, Hon. Susan M. 
Collins, Chairman of the Committee, presiding.
    Present: Senators Collins, McSally, Hawley, Braun, Rick 
Scott, Casey, Blumenthal, Jones, Sinema, and Rosen.

                 OPENING STATEMENT OF SENATOR 
                   SUSAN M. COLLINS, CHAIRMAN

    The Chairman. The Committee will come to order.
    Good morning. Ten thousand Americans are turning 65 every 
day. It used to be that this was the traditional age of 
retirement, but today, as this Committee has examined in 
previous hearings, many older Americans continue to work well 
past the age of 65. Some of those who are healthy enough want 
to continue working because of the personal satisfaction it 
brings. Others, however, continue to work because they simply 
have no choice. They cannot afford to retire.
    The Center for Retirement Research estimates that there is 
a $7.8 trillion gap between what Americans have saved for 
retirement and what they will actually need. As Americans live 
longer, the risk that they will outlive their savings only 
increases.
    Perhaps most startling are studies that show just how 
little Americans have in savings. According to the AARP, the 
typical working household in the State of Maine has just $3,000 
saved for retirement. In fact, one out of two Americans has 
less than $1,000 in savings. For those living paycheck to 
paycheck, it can be difficult to cover the heating bill or 
afford much-needed medications, much less save for the future. 
For many, saving for retirement seems out of the question.
    I am also particularly concerned about the impact of those 
who take time out from the workforce to care for others on 
their retirement security. We know that time spent caring for 
loved ones can have implications for lifetime earnings and 
retirement savings.
    We are on the verge of a national crisis. We did not get 
here overnight. Over the past several decades, employment 
patterns in America have changed, creating new opportunities in 
some ways, and in other ways challenging the notion of 
retirement as our parents and our grandparents knew it. Three 
emerging retirement trends, in particular, warrant our 
attention.
    First, traditional pensions outside of the public sector 
are rare these days as employers have shifted away from 
employer-based ``defined benefit'' plans to ``defined 
contribution'' plans, such as 401(k)'s. This means that 
individuals are becoming increasingly responsible for their own 
retirement planning and are assuming more of the risk.
    Second, Americans who look to employer-sponsored plans are 
finding that many companies simply do not offer this option. In 
Maine, about 46 percent of all private sector employees work 
for an employer that does not offer a retirement plan.
    Third, it is increasingly clear that Social Security should 
not be the only source of retirement income that retirees count 
on to sustain their current standard of living. Nationwide, the 
Social Security Administration notes that among its 
beneficiaries, 48 percent of married couples and 69 percent of 
unmarried individuals receive half of their income for 
retirement, or more, from Social Security. Many seniors in my 
State rely almost solely on Social Security to cover their 
monthly expenses in retirement, despite the fact that the 
average annual benefit is just under $16,000 a year.
    Today we will examine the State of our Nation's retirement 
system. The Government Accountability Office has done extensive 
work studying this issue, including issuing this very 
comprehensive report, which has been updated for our hearing, 
and I very much appreciate the Comptroller General's personal 
interest in addressing the challenges that make it difficult 
for far too many Americans to have a comfortable retirement by 
adequately saving for the future.
    At the Federal level, we must continue to look for ways to 
help employers who wish to do so to start their own retirement 
plans for their employees. The Small Business Administration 
estimates that about 60 million Americans work for small 
businesses. To help make it easier and less expensive for these 
employers to establish retirement plans, as well as to 
encourage individuals to save more of their own hard-earned 
money, Senator Hassan and I have introduced the Retirement 
Security Act, and to provide greater flexibility and access to 
both employees and their employers seeking to use the popular 
SIMPLE plans as an option for saving for retirement, I have 
also introduced a second bill, the SIMPLE Plan Modernization 
Act, with my colleague Senator Mark Warner of Virginia.
    We know that when full-time employees have access to 
retirement plans, on average 85 percent will contribute. 
Clearly, increasing access to employer-sponsored plans is a 
vital part of ensuring retirement security.
    This is a significant public policy problem that requires 
bipartisan solutions. The longer that we ignore the looming 
retirement crisis, the worse that it will become. After 
spending decades in the workforce, seniors should be confident 
that they will have the money needed to pay their bills and 
enjoy their retirement, without the fear that they will fall 
into poverty during their golden years. I look forward to our 
discussion today with the excellent panel that we have 
assembled, and I am now delighted to turn to our Ranking 
Member, Senator Casey, for his opening statement.

                 OPENING STATEMENT OF SENATOR 
              ROBERT P. CASEY, JR., RANKING MEMBER

    Senator Casey. Thank you, Chairman Collins, for holding 
this hearing today on this critically important subject.
    Having financial security in retirement is a goal for each 
and every family in America. All of us hope that when we reach 
old age, we will be able to enjoy retirement on our own terms, 
but the reality is that millions of American families are 
approaching retirement with almost nothing saved, and despite 
working hard their whole lives, too many seniors are finding 
themselves barely able to make ends meet.
    According to the GAO, roughly one in four households ages 
65 to 74 have zero--zero--retirement savings of any kind, and 
many others have managed to save only a fraction of what they 
will need. Some are living in fear of seeing significant cuts 
to a pension they have planned their lives around. The truth is 
that our retirement system does well for some, but it allows 
millions of Americans to fall through the cracks.
    As we will hear today, this is particularly true when it 
comes to women, who on average have lower retirement incomes 
and are more likely to live in poverty when in old age, and it 
is true for people who lack access to savings options at work 
and those who did earn retirement benefits at work but now live 
in danger of seeing them cut.
    Our Nation deserves better, more secure retirement options. 
We can start by strengthening the backbone of our Nation's 
retirement system, Social Security itself. We must ensure that 
Social Security is able to keep the promise--the promise--of 
financial security in retirement. We must not let Americans 
relying upon Social Security slide into poverty.
    That is why today I am introducing a bill to boost Social 
Security benefits for women who are the most likely to end up 
in poverty. Widows and widows with disabilities are 
significantly more likely to live in poverty in old age than 
are other Social Security recipients. The bill is the Surviving 
Widow Income Fair Treatment Act, which would eliminate 
arbitrary claiming rules and caps that substantially reduce a 
widow's benefits. I am pleased that a number of my colleagues 
have joined in introducing this bill, two members of this 
committee, in fact, Senators Blumenthal and Gillibrand.
    In addition to strengthening Social Security, we must 
ensure that promises to workers relying upon pensions are kept. 
Workers across the country, including tens of thousands in my 
home State of Pennsylvania, fear the pensions they have earned 
will be dramatically cut through no fault of their own. 
Congress must act immediately to keep multiemployer pensions 
solvent.
    Finally, we must work to ensure that our retirement savings 
system works for all Americans. We must work to expand access 
to workplace retirement plans, and we must make tax incentives 
for retirement savings, like the Saver's Credit, useful to the 
families who actually need it the most.
    We must approach these problems in a comprehensive fashion 
that ensures that all workers can participate and that all 
workers receive the benefits they have earned.
    I would also like to quickly note that for today's hearing, 
we are pleased to be represented at the witness table by so 
many with Pennsylvania roots. Linda Stone is from Bryn Mawr, 
Pennsylvania, and does a lot of her work obviously in 
Pennsylvania. The Comptroller General is here who has roots in 
Pennsylvania and who graduated from Lycoming College. John 
Scott has two degrees from Pennsylvania schools, and we are 
happy about that, both Penn State and, I have here--Penn State 
and Swarthmore. Yes, those are the two, and before the hearing 
is over, probably someone else will stand up and claim 
Pennsylvania roots.
    Chairman Collins, I will try not to dwell on that, but we 
are grateful for the time you set aside for this hearing on 
this critical issue. Thanks very much.
    The Chairman. Senator Casey, I will say that you did manage 
to one-up me on the number of witnesses with ties to your 
State, but I would point out that I was Chairman of the 
Committee with responsibility for confirming the Comptroller 
General, so but for me----
    Senator Casey. I think you got me.
    The Chairman. I do want to welcome a new member of our 
Committee, Senator Scott from Florida. Obviously, Florida is 
the State with the oldest percentage of seniors. Maine is the 
oldest State by median age, and Pennsylvania is not far behind, 
so all three of us have a deep commitment to the issue of 
improving retirement security, which is one of the four major 
focuses of our Committee.
    Let me now turn to our witnesses, and, again, welcome, 
Senator Scott, for being a member of the Senate Aging 
Committee.
    First, I am very pleased to welcome the much sought and 
fought over this morning Comptroller General of the United 
States, Gene Dodaro. Mr. Dodaro's career at the GAO spans more 
than 40 years. His testimony today is based on extensive work 
the GAO has done to examine the State of the Nation's 
retirement system, but I also know that this is a personal 
passion for him and that he has been sounding the alarm for 
many years, so we welcome you and look forward to your 
testimony.
    Next we will hear from John Scott, the retirement savings 
project director at The Pew Charitable Trusts. Mr. Scott 
conducts original research to unlock barriers to retirement 
savings. He also develops policy initiatives that could lead to 
increased retirement savings and other strategies to encourage 
Americans to save more.
    We will then turn to our next witness who happens to be 
from the great State of Maine, Denis St. Peter. Mr. St. Peter 
is the president and CEO of CES, an engineering firm in Brewer, 
Maine. CES employs around 100 people and was recently the 
recipient of this year's Bangor Regional Chamber of Commerce 
Business of the Year Award. He will describe the challenges of 
establishing effective retirement plans for small businesses 
and the benefits of such plans to employees.
    I will now turn to our Ranking Member, Senator Casey, to 
introduce our final witness.
    Senator Casey. Thank you, Chairman Collins. I am pleased to 
introduce Linda Stone from Bryn Mawr, Pennsylvania, Montgomery 
County. Linda Stone is currently a volunteer fellow with the 
Women's Institute for Secure Retirement. She is an actuary, 26 
years' experience advising companies on their retirement plans, 
a graduate of St. Joe's University. She travels across 
Pennsylvania to educate people on the challenges that women 
face in preparing for retirement. In fact, she spent her career 
working in retirement security. She will tell us about what can 
be done to help more Americans gain economic security in 
retirement.
    Linda, we are grateful you are here. Thanks for traveling 
to Washington, and we are looking forward to your testimony.
    The Chairman. Thank you very much.
    I also want to welcome another new member to our Committee, 
Senator Jacky Rosen from Nevada. We are delighted to have you 
joining our Committee as well. Thank you.
    Comptroller General, the floor is yours.

         STATEMENT OF HON. GENE L. DODARO, COMPTROLLER 
         GENERAL OF THE UNITED STATES, WASHINGTON, D.C.

    Mr. Dodaro. Thank you very much. Chairman Collins, it is a 
pleasure to be here, Ranking Member Senator Casey, Senator 
Rosen. I greatly appreciate the opportunity to talk about GAO's 
work on this important subject.
    The current retirement system is not well prepared to meet 
the 21st century needs of our country. All three pillars of the 
system--Government programs, employer-based solutions, 
individuals savings on their own--are under a lot of stress and 
face a number of challenges going forward.
    In the Government domain, the Social Security Old-Age and 
Survivors Trust Fund will have enough to pay 77 percent of 
scheduled benefits by 2034, and it faces serious and 
substantial long-term solvency problems.
    The multiemployer portion of the Pension Benefit Guaranty 
Corporation is expected at 90 percent certainty to be insolvent 
by 2025.
    The Medicare Hospital Trust Fund by 2026 will only have 
enough funds to pay 91 cents on the dollar of scheduled 
Medicare benefits.
    When you turn to the employer side, one-third of all 
working populations have no access to employer-based plans, so 
they are very limited, and you pointed this out in your opening 
comments very appropriately, and the shift, as Chairman Collins 
explained, to defined contribution plans from defined benefit 
plans has a number of implications.
    On the positive side, it more fits the mobility of the 
workforce today because the benefits are portable. A number of 
people are using it to meaningfully save for retirement, 
particularly high-income workers.
    On the other side, low-income workers tend to have much 
smaller balances in their accounts, and, importantly, as you 
point out, Chairman Collins, it shifted the responsibility to 
individuals to make many more complicated financial decisions 
on their own, in many cases without a lot of support in order 
to do so. It raises the risk for individuals.
    Now, the third pillar has always been individuals saving on 
their own in addition to these vehicles by the Government and 
the employers, but there we see many challenges. Some people 
are doing very well, but many are not, and they are facing head 
winds of relatively low real wage growth, high household debt 
payments, and rising costs for out-of-pocket health care costs, 
which continue to rise faster than the economy, so they are 
struggling as well.
    The bottom line in this case is that it has been over 40 
years since the Congress commissioned a comprehensive 
commission to look holistically at the retirement system in the 
United States.
    Many actions have been taken incrementally over the years--
the establishment of the Social Security system in 1935, the 
ERISA law in 1974, and there have been a lot of incremental 
changes since then, but the demographics of the country have 
changed dramatically. We are aging as a population. We have low 
fertility rates, increased longevity--which is a good thing, 
but it is causing people to live a lot longer and, therefore, 
the financial models particularly for Social Security and some 
of the PBGC programs, are not well suited to meet these current 
needs and are really in imminent danger of not fulfilling the 
promise, Senator Casey, as you mentioned, that our country has 
made.
    I would urge the Congress to act on GAO's recommendation, 
which would be to establish a comprehensive commission to look 
at all these things interrelated and not just look at Social 
Security alone or employer-based systems or individuals' 
efforts, but to look comprehensively at this, given the 
changing dynamics of our country and the changing nature of 
work in the United States, and unless the Congress acts soon, I 
am afraid many Americans will not face a safe and secure 
retirement, and also the fiscal pressures will mount on the 
Federal Government at a time when the Federal Government is 
already on a long-term, unsustainable fiscal path.
    These are very weighty policy issues, both public policy 
and fiscal policy, and I really commend the Committee for 
focusing in on these issues and taking this very seriously. 
Whatever we could do at GAO to help, we will continue to do so.
    I would be happy to answer questions at the appropriate 
time.
    The Chairman. Thank you very much, Mr. Dodaro.
    Mr. Scott.

                    STATEMENT OF JOHN SCOTT,

              RETIREMENT SAVINGS PROJECT DIRECTOR,

          THE PEW CHARITABLE TRUSTS, WASHINGTON, D.C.

    Mr. John Scott. Thank you, Madam Chairwoman and Ranking 
Member Casey, for the opportunity to testify on the importance 
of financial security in retirement. The Pew Charitable Trusts 
is an independent, nonpartisan, nonprofit organization that 
applies a rigorous analytical approach to improve public 
policy.
    While workplace retirement plans are the primary vehicle 
for ensuring financial security in old age, as was noted, one-
third of private sector workers still lack access to a 
retirement plan. Inadequate savings are not just bad for 
workers' retirement security, but also impose costs for Federal 
and State governments as well as on the larger economy.
    A 2016 study by the University of Maine, for example, found 
that Maine's retirement age population is projected to increase 
30 percent by 2032. The associated costs of social services 
could grow to $362 million by 2032, with the State's share 
growing to $61 million, which would be double what the State 
covered in 2016.
    A similar Pennsylvania study determined that net costs to 
the Commonwealth due to insufficient retirement savings are 
projected to grow to $1.1 billion by 2030.
    To understand the barriers to savings, our research focused 
on small businesses and their employees. Certain categories of 
workers at small firms have inadequate retirement coverage. For 
example, part-timers are almost half as likely as full-time 
workers to have access to retirement benefits, and Hispanic, 
black, and Asian workers have much lower access rates than 
whites, but given the importance of plan sponsorship, I want to 
focus my remarks on small employers.
    Pew surveyed over 1,600 small business owners, both plan 
sponsors and those that did not sponsor a plan. We found that 
employers offered various reasons for providing retirement 
benefits. Nearly half cited a desire to help employees save for 
retirement as the main reason. Nearly a third said attracting 
and retaining workers was the reason they offered a retirement 
plan.
    We also found that firm financial stability is strongly 
associated with plan sponsorship. For example, employers with 
increasing earnings are much more likely to offer a plan than 
if earnings were flat. Businesses then tend to adopt plans 
during a middle phase in their development after initial 
startup and during a period of expansion and growth.
    We also asked about plan features that can improve workers' 
financial security, like employer contributions and automatic 
enrollment. Nearly all surveyed employers with retirement 
savings plans made employer contributions, but two-thirds of 
small business plan sponsors did not automatically enroll their 
workers. When asked why not, executives said either they were 
satisfied with their current set-up or they perceived employees 
would not like to be automatically enrolled.
    We also surveyed employers that did not sponsor retirement 
plans, and we first asked why they did not offer one. Thirty-
seven percent of employers cited startup costs as too 
expensive; another 22 percent cited a lack of internal 
administrative capacity to run a retirement plan. Unfamiliarity 
with retirement plan options may also be a barrier. For 
example, only 11 percent of survey respondents were very 
familiar with a SIMPLE IRA plan, which is designed for small 
businesses.
    When businesses without a plan were asked what would 
motivate them to begin one, clear majorities cited increased 
business profits and increased tax credits for startup costs.
    There are many promising ideas to address these and other 
challenges. Let me note that Pew does not endorse or oppose any 
particular legislative initiative. However, legislation such as 
introduced by Senator Collins and your colleagues emphasized 
critical areas such as automatic enrollment, multiple employer 
plans, or MEPs, improving SIMPLE IRA plans, and increasing tax 
credits for startup costs.
    Initiatives that reduce plans' startup costs and improving 
awareness of SIMPLE plans and other plan options could be 
useful in encouraging new plan formation, and our research 
found that small businesses reacted very positively to the idea 
of MEPs, although it is not clear if they would actually join 
MEPs if they were made more widely available.
    Auto-enrollment also could boost participation. For 
example, in the State of Oregon, where they are using auto-
enrollment to cover workers who do not have a plan at their 
jobs, 70 percent of workers are participating and saving at a 
rate of just over 5 percent of pay, but as you know, more work 
needs to be done, and in that regard I want to commend the GAO 
for their 2017 report and for their call for a comprehensive 
examination of the retirement system.
    Thank you again for the opportunity to testify.
    The Chairman. Thank you very much, Mr. Scott, for all that 
great data. I appreciate it.
    Mr. St. Peter.

          STATEMENT OF DENIS ST. PETER, PRESIDENT AND 
       CHIEF EXECUTIVE OFFICER, CES, INC., BREWER, MAINE

    Mr. St. Peter. Chair Collins, Ranking Member Casey, thank 
you very much for inviting me here today to discuss our company 
approach to promoting retirement savings for our employees. My 
name is Denis St. Peter, and I am licensed professional 
engineer in the great State of Maine. I am also the president 
and CEO of our company, but I am not a finance expert, so more 
an engineering degree.
    I have some additional information about our company in my 
written testimony, but for the sake of time, I am skipping 
through it. It includes our mission, vision, value statements, 
which I think are key to the approach that we took to improve 
our retirement plan. If you take the time to read through that, 
you will see that we do focus on and care about our employees, 
we care about our clients, and we care about the communities 
that we live and work in.
    About 10 years ago, we went through an ownership and 
leadership transition in our company. That gave us an 
opportunity to reevaluate our business approaches, one of which 
was our retirement plan. At the time we had a 401(k) plan with 
a profit-sharing component, but we did not have a match at the 
time, so there were really four key things that led us to 
change that.
    The first one, the lack of matching, was really perceived 
by our key employees as a missing component to our benefit 
plan, so for us to retain top talent and recruit good people, 
we felt we needed to add that, and again, it was consistent 
with our mission, vision, values.
    The second item was that, in general, we knew that our CES 
employees were underfunding their retirement. We had a 
participation rate at about 62 percent and an average employee 
contribution around 3.9 percent of base salary.
    The third item was really my history. As the first job I 
had out of college, I worked for the Federal Government, and I 
had 5-percent match opportunity, and I remembered how that 
really made me think about saving for retirement at that point. 
I am not sure I would have saved if I did not have the match.
    The fourth criteria really was the top-heavy testing that 
was required in our plan, and we were close to exceeding that 
60-percent limit.
    We set a course on improving our plan. Our goal was to get 
to the 4-percent match. We increased it 1 percent a year to get 
to that 4 percent. That was in the 2011 to 2014 timeframe. We 
also implemented several other best practices. We started an 
investment committee, including an investment adviser to 
participate in that committee. We fully utilized our third-
party administrator. We also established our benefits committee 
and lots and lots of education and communication with our 
employees.
    I have got four slides that show the results of our 
progress, the first one being participation rate. As I 
mentioned before, we were around 62 percent. We are up close to 
90 percent. Our goal is 100 percent. We are getting there.
    The next slide is average contribution as a percentage of 
base salary. We were averaging just under 4 percent, and now we 
are up to close to 14 percent.
    The next slide is our 401(k) plan asset value. In 2010, we 
were at $2.45 million. We are now at $7.27 million. That 
includes a sizable distribution from one of our founding 
partners, so probably about closer to $8 million.
    Then the last slide is the top-heavy testing results. As I 
mentioned earlier, we were close to the 60-percent limit, at 
59.8, and we have shown some pretty good results from our 
matching program and other best practices. We are down to 48.7 
percent.
    I would be willing to answer any questions later.
    The Chairman. Thank you very much, Mr. St. Peter.
    Ms. Stone.

                  STATEMENT OF LINDA K. STONE,

           FELLOW VOLUNTEER, WOMEN'S INSTITUTE FOR A

       SECURE RETIREMENT (WISER), BRYN MAWR, PENNSYLVANIA

    Ms. Stone. Good morning, Chairman Collins, Ranking Member 
Casey, and distinguished members of the Committee. I appreciate 
the opportunity to appear before you today to discuss financial 
security in retirement, including the significant and unique 
retirement risks that many women face.
    I am here today in my capacity as a volunteer Fellow with 
the Women's Institute for a Secure Retirement (WISER). WISER is 
a nonprofit organization that works to help women, educators, 
and policymakers understand the important issues surrounding 
women's retirement income. Through my work with WISER and the 
National Resource Center on Women and Retirement Planning, in 
cooperation with the Administration on Aging, I have presented 
workshops to diverse groups of women across the country and 
have heard directly about their experiences.
    One reason that I am so passionate about this issue is the 
experience of my own mother. She was a ``Rosie the Riveter'' 
who worked in the shipyards in Chester, Pennsylvania, during 
World War II. After her divorce from my father, she was able to 
support our family while working as a machinist and later as a 
nursing home aide. She did not know to try to get a spousal 
benefit from my father's workplace retirement plan or to see if 
there were spousal Social Security benefits that would be 
larger than her own. There is more that can be done to help 
women like my mother have a secure retirement.
    First, I would like to address a question that WISER often 
receives: Why focus on women? Quite simply, there are 5.7 
million more women than men at age 65, and 67 percent of the 
over-age-85 population are female. Many women over age 85 end 
up near-poor or in poverty even if they have never been poor 
before. Women face greater longevity risk than men due to their 
longer lives and the resulting need for more income. At age 65, 
women can expect to live an average of 21-plus years, 3 years 
Mr. St. Peter than men. One out of every two women in their 
mid-50's today will live until age 90.
    Having more income during retirement starts with your 
earnings during your working years and your access to employer-
sponsored savings and pension plans. Generally, no matter how 
you slice and dice it, women earn less than men throughout 
their lifetimes. Caregiving responsibilities for children, 
parents, as well as spouses cause women to spend years out of 
the job market or to work part-time without access to benefits. 
Social Security reports that, on average, women have 9 years 
with zero earnings. The zero earnings are compounded in the 
calculation of their Social Security benefit.
    This all results in women having less in savings and 
employer-sponsored retirement benefits as most employer plans 
require full-time status to be able to participate and base 
benefits on pay, and many women who work have no access to 
employer-sponsored plans.
    A long life increases the risk that inflation will 
negatively impact the ability to live on a limited income and 
increases the chance that women will outlive their assets. 
Women are more likely to need long-term care in these later 
years as they are less likely to have a family caregiver. Among 
women more than 85 years old, 87 percent are not married.
    The bottom line is that women accumulate less money than 
men during their working years and have to make it last longer.
    Women often have a planning horizon that is much too short. 
As a result, they underestimate their need for savings to 
support the many years they will be in retirement and the need 
to start saving as early as possible.
    Women nearing retirement who do have savings have the 
burden of not only determining how to invest the money before 
retirement but also how to appropriately spend down their 
savings so that the assets last for their lifetime. As they 
change jobs, many do not appreciate how not cashing out 
balances, no matter how small, can make a big difference in the 
amount of money that is available at retirement.
    The reality of today's retirement landscape for many is do-
it-yourself, and do it right, or live at or below the edge of 
poverty. The nature of today's system of individual 
responsibility demands financial capability. Women are in the 
difficult position of making big decisions while being unable 
to afford even a small mistake. Divorce, widowhood, and needing 
to leave the workplace earlier than expected can derail even 
the best planners.
    We need to strengthen existing programs wherever possible. 
That means focusing on Social Security and Medicare, expanding 
access to employer-sponsored retirement programs, and 
supporting and expanding individual savings initiatives.
    In conclusion, thank you for including a focus on women's 
retirement issues today. We know from the women who have 
contacted WISER and attended our workshops that they want to 
take better control of their retirement. We need to make sure 
every woman is getting support they need through education and 
access to carefully crafted programs that will make a 
difference in their ability to have a secure retirement.
    The Chairman. Thank you very much, Ms. Stone.
    Comptroller General, I want to start with you, and I want 
to start with a very basic question. First, however, let me 
acknowledge that we have been joined by three more of our 
colleagues: Senator McSally, Senator Braun, and Senator Jones. 
You will find that members will be coming in and out throughout 
the hearing, as Mr. Dodaro is well aware of, but it may come as 
a surprise to others as Senators are trying to balance 
complicated schedules.
    Comptroller General, I want to start with a very basic 
question, and that is, what are the biggest impediments that 
employees face in saving enough for retirement?
    Mr. Dodaro. There are a number of factors. I mentioned some 
earlier that I think are very important. One is that there is 
relatively low real wage growth, and many of the people in the 
country are earning about the same as they were in 1970 in real 
purchasing power, so that is number one.
    Number two is the accumulation of debt, but also I would 
say rising health care costs. Health care costs continue to 
rise faster than the economy, so the out-of-pocket costs are 
really important, and this is a factor in planning for 
retirement because you have more health care costs when you are 
in retirement and through the rest of your life. There are also 
features of the individual plans. In a defined contribution 
plan, those plans that do not have automatic enrollment reduce 
participation. We find that if there is automatic enrollment 
and even in some cases an auto-escalation clause as employees 
earn more, that helps save.
    You also have fees in those programs that are problematic 
in defined contribution plans, and in the defined benefit 
plans, there you have portability issues. If you change jobs 
frequently, there are the vesting requirements that are a 
problem in both kinds of plans, both defined contribution and 
defined benefit, and people do not understand that. Sometimes 
when they change jobs, they roll over or do not roll over their 
retirement accounts appropriately, so there are a lot of 
complicated factors.
    There is a set of basic economic factors that are important 
impediments, and then there are features of these plans that 
also can be impediments as well.
    The Chairman. Thank you.
    Mr. St. Peter, Ms. Stone mentioned people taking money out 
of their retirement plans when they change jobs and using it 
for non-retirement purposes, and I think when people are in 
their 20's and 30's, retirement seems so far away that 
oftentimes bad decisions are made, and I will confess to the 
worst financial decision that I ever made, which was when I 
left the Hill as a staffer with almost 12 years of retirement 
contributions, I withdrew all the money to buy a car instead of 
getting a car loan, and that was the worst financial decision I 
have ever made in my entire life, but I swear if just one 
person had said to me when I filed to withdraw the money, ``Do 
you really want to do this? You are already vested, and the 
implications are enormous, and there is nothing wrong with 
getting a car loan.'' I was just thinking, ``Oh, I cannot take 
on debt.'' And it was truly such a bad decision.
    I think a really important part of what your company does, 
Mr. St. Peter, is helping to improve people's understanding, 
your workers' understanding of financial decisions. Could you 
explain a little bit what you do?
    Mr. St. Peter. Sure. It is a double-edged sword, I think, 
the borrowing component of our 401(k) plans. I think it helps 
attract participation because they know it is not locked 
forever, but we do see the urge to borrow from the plan, and 
the benefit that we have as an employer is that we have an H.R. 
director who is kind of the first line that can counsel our 
employees that want to borrow from it, educate them that way. 
If she feels like she needs more expert advice, we have our 
investment adviser that willingly gives his time to communicate 
with an employee and help educate them of the negative 
consequences, and then the third line is our direct 
supervisors.
    We do have plenty of opportunities, and we just need to 
remind ourselves as a company to continue to take those 
opportunities to communicate with them.
    The Chairman. Your participation rate of nearly 90 percent 
is really impressive and shows the effort that you have made.
    Senator Casey?
    Senator Casey. Thank you, Chairman Collins.
    I will start with Linda Stone. Ms. Stone, I wanted to start 
with part of your written testimony where you talked about the 
complexity of Social Security claiming rules, and that might be 
among the biggest understatements that we can utter.
    Ms. Stone. Yes.
    Senator Casey. These issues get very, very little 
attention, and they warrant a spotlight, and I am grateful you 
are helping us with that today.
    The bill I talked about earlier would ensure that recently 
widowed individuals receive better information on the benefits 
available to them and how their claiming decisions, these 
complex rules and the decisions that flow from them, can 
permanently affect their retirement income.
    Based upon your experience talking with women in 
Pennsylvania saving for retirement, do you think there is a 
greater need for both more education and more guidance when it 
comes to these decisions?
    Ms. Stone. Yes, I think both, Senator Casey. Social 
Security claiming strategies can be very complicated, as you 
said, and a lot of women do not even quite understand that 65 
is not their Social Security full retirement age anymore. For 
some of them it is 67, and what does that mean if they take 
their benefit at 62? Because it is available at 62. That is 
quite a big reduction that lasts for somebody's whole entire 
life, and there does not seem to be as much knowledge about 
that as there could be.
    We get a lot of questions from women who are divorced, and 
one of the biggest ``aha'' moments that happens in some of our 
workshops is when we mention that if you have been married for 
10 years, you are eligible to collect on your ex-spouse's 
Social Security benefit, and so questions around surviving 
spouse benefits are also something that comes up quite often. 
You know, how are you eligible and how do you coordinate that 
if you also have a worker benefit? And you are likely aware 
that last year there was a report by the Social Security Office 
of the Inspector General that showed widows are not getting all 
of their options explained to them when they claim their 
benefit, and this has cost women hundreds of millions of 
dollars, because the rules are just incredibly complicated, and 
women need more education and, you know, factual advice on the 
implications of their decisions when they are in the process of 
making that decision that is going to impact their benefit for 
the rest of their life.
    Senator Casey. I guess part of this, of course, is what--in 
the case where it is a husband and a wife, and the wife 
survives, the husband passes away, sometimes the problem is 
what decision the husband made that then binds or limits what 
happens with the surviving spouse, the widow. Can you just walk 
through that circumstance?
    Ms. Stone. Yes. One of the things we talk about is that 
couples should figure out as a couple their claiming strategy, 
each of them, and then each of them as a couple, and obviously, 
they have different income levels, different life expectancies, 
and because the survivor benefit, you know, depends on the kind 
of highest benefit that the couple has, if the person making 
the most money--and for this we will say that is the husband--
you know, can delay receipt of their benefit, that will leave 
more of a survivor benefit for their widow, but maybe they just 
want to collect it early, and they do not think as a couple we 
will be better off in the long run if you postpone getting your 
benefit so it does not get the early reduction or even 
increases it 8 percent a year if you wait past your full 
retirement age. That is a pretty good return to push that 
benefit back, and that means, you know, I will have as your 
widow a bigger survivor benefit, so let us think about what 
make sense for the family as we think about this, not just, you 
know, each of us as individuals, and that is something that, 
again, needs to be more education around a family discussion on 
that.
    Senator Casey. I know I have limited time, and I will try 
to do some followup, but, Comptroller General Dodaro, I wanted 
to ask you about the circumstance that you outline urging us to 
take action. If Congress does not take action, do you think it 
is likely that many current and future retirees in these 
multiemployer pension plans will see their benefits cut?
    Mr. Dodaro. Definitely. I mentioned it is 90 percent 
certain that PGBC's multiemployer insurance program will be 
insolvent by 2025. It goes up to 99 percent by 2026. If that 
happens, the amount of benefits that plan participants would 
receive will be even lower than what they are now. The single 
employer insurance program has a higher benefit. If you work 30 
years, you can get about $13,000, but if they go insolvent, 
they could get less than $2,000 a year, so that is not much of 
a retirement benefit, so they would definitely be hurt, so for 
the multiemployer portion, it is very urgent that Congress take 
action. I was pleased in the last Congress that a special 
committee was set up in order to address that, but they did not 
produce a final report, and I have been urging Congress on this 
for years. We have had the multiemployer program on our High-
Risk List across the Government since 2009. We have had the 
single-employer program on it since 2003. That program is doing 
a little better now, but even the single-employer plan has 
reasonable expectations of losses of about $175 billion, 
according to recent PBGC estimates, so both components of 
PBGC's programs are facing financial uncertainty, but for right 
now, the most urgent program is the multiemployer program, and 
Congress needs to act, or these people are not going to have 
any meaningful benefit at all.
    Senator Casey. Thank you.
    The Chairman. Thank you.
    Senator McSally?
    Senator McSally. Thank you, Madam Chair. Thanks for having 
this important hearing today and for all the testimony.
    When I was over in the House, I started a working group on 
Women in the Workforce in the 21st Century, trying to identify 
what are the real issues that women are facing in the workforce 
and how we can close the pay gap on education and just choices 
that are happening in people's lives, and especially for women. 
As you mentioned, Ms. Stone, women are more likely to be 
caregivers for their children and their parents, and we had 
some testimony related to exactly what you are talking about 
today, and this is hearing is highlighting that it is not just 
impacting them through their whole lives, but as they are 
living longer, they have less income, less retirement, more 
likely to be in poverty, so I really appreciate all the work 
that you are doing to address this issue.
    You know, it seems like we are in situation where those who 
are retiring now, those women, the Baby Boomers, they have less 
earnings throughout their whole life, less savings, less 
retirement, less Social Security. Yet my generation--which is, 
what, Gen X?--we are the ones that are more likely to be then 
caring for them, so we are coming behind them with the very 
same dynamics happening. Women are wanting more flexibility. 
Women are wanting to be able to move in and out of the 
workforce. We are seeing this with our generation, which then 
is going to perpetuate the challenges that you mentioned as our 
generation moves into retirement.
    You mentioned in your testimony as some solutions, study 
ways to offer retirement protections to women with significant 
time spent as caregivers, including possibility of a provision 
for Social Security credits and credits for out-of-pocket 
expenses that may be preventing women from saving. Can you talk 
a little bit more about what you are proposing there and what 
that would look like?
    Ms. Stone. Well, I am not making any specific 
recommendations. I think there are a number of recommendations 
or thoughts around how to reflect caregiving in Social 
Security, and I think that is good that the conversation is 
happening. I think one of the things that we try to do at WISER 
is have women understand, before they make the decision to 
leave the workplace to care for someone, the actual kind of 
opportunity cost of that, that they are not only giving up 
their pay, they are giving up, you know, maybe their employer-
provided benefits, other benefits that they may have, and are 
they going to be able to get back in the workplace?
    Some of what we are trying to do is have people understand 
there may be other options that could be used to not give up 
your own financial security necessarily as your first reaction 
is, ``I have to quit my job to go take care of Mom.''
    I think what we are trying to do is educate women, and I 
think to have kind of a policy decision about the facts, which 
is women do spend a lot of time out of the workplace, I think 
it is just good that that conversation is happening.
    Senator McSally. Great. Thanks. I want to followup with you 
maybe afterwards about any other specific ideas policy-wise, 
you know, related to what we are talking about.
    Also in Arizona, 54 percent of women are family caregivers 
right now, and we have a growing aging population in Arizona, 
so this is something that is very real, and trying to keep 
individuals in their homes and allow a better quality of life 
in their older years, these financial barriers are very real 
for so many of the people that I represent.
    I wanted to also ask about, you know, just the additional 
education we can have related to when someone becomes a widow 
or they are trying to make decisions with their own Social 
Security benefits. This is really complicated, as you said, and 
it is not--as is explained to you, I just went through this 
with someone close to me who lost her husband. It was like 
Mandarin Chinese; trying to understand what her options were 
and whether her own income and where the offset was and what 
month she might be able to get a benefit, it was really 
confusing.
    What can we do to make sure that it is simplified in the 
way, you know, individuals understand their options when they 
are looking at what their Social Security benefits are as a 
survivor or as someone who is continuing to work.
    Ms. Stone. Yes, I agree with you that is very complicated 
and more needs to be done, and I think it gets to how is the 
communication happening. You know, there used to be Social 
Security benefit statements mailed to people on an annual 
basis. That does not happen anymore, because then people could 
at least start getting used to like looking at their earnings: 
``Oh, I see zeroes there. What does that mean?'' And, ``What is 
my benefit?'' And even to feel like when you call, you know, 
Social Security workers are doing their best, but it is very 
complicated, and to try to just get this explained to you over 
the phone, I do not know how anybody could really make 
decisions without really seeing something and, you know, can we 
have communications be done in a way that people can more 
easily read and understand them? Because some information is 
out there, and it is just making sure people know where to get 
that information and maybe having it, you know, kind of pushed 
to them versus having people out on the Internet trying to find 
some of this information themselves.
    Senator McSally. Great. Thank you. I am out of time. I 
appreciate it.
    The Chairman. Thank you.
    Senator Jones?
    Senator Jones. Thank you, Chairman Collins. I appreciate 
it, and thank you all for coming today.
    Just to pick up a little bit on what Senator McSally said, 
with regard to women, obviously, you know, the President talked 
last night about the women in the workforce now. More and more 
women entering the workforce will hopefully narrow that savings 
gap a little bit down the road, but at the same time, 50 years 
or more after the passage of the Equal Pay Act, 10 years after 
the passage of the Lilly Ledbetter Fair--Equal Pay for Equal 
Work Act, we still have a disparity between the income of men 
and the income of women. Recently, a number of Senators and 
Members of Congress reintroduced the Paycheck Fairness Act, 
which has been introduced now 12 times since 1997, to try to 
help narrow that gap.
    I would assume that if we can also work as Members of 
Congress to narrow that pay gap, do what we can to make sure 
that women get the same pay as men, that is going to reap 
benefits down the road for women in retirement. Is that 
correct, Ms. Stone?
    Ms. Stone. Yes, because as I mentioned, many employer plans 
are based on somebody's earnings, and so higher earnings means 
a higher benefit, and also, if you are making more money, you 
certainly have more of an ability to put more money away in 
savings and get that employer match if they are offering that 
match.
    Senator Jones. It is not just for now. It is for the future 
when we are trying to do this, so thank you very much.
    I also want to--you know, I really appreciate the hearing, 
Madam Chairman, because I am witnessing an issue with my 
parents. My Dad worked at U.S. Steel and then had another job. 
He had a retirement U.S. Steel. He had Social Security, about 
as much as he could make for his generation. He is 87. My Mom 
worked sporadically, did not do a whole lot, but they planned. 
They thought they had a very good plan. They were putting money 
aside. They took some money from an investment and paid off 
their mortgage. What they did not anticipate, though, was Dad's 
Alzheimer's and having to go in extended care. They are both 87 
years old now, and their savings is dwindling rapidly because 
of that.
    What can we do for people that are just the young people--I 
agree. Impulsively, I bought a similar car, but I bet mine is 
sharper than yours is, so I can relate. What can we do not just 
for the young folks of today, though, but for those folks that 
are 45, 50 years old that are also making these decisions, what 
can we do to educate so that they can understand that we are 
living longer and that we have got to make sure that we plan 
for that old age that may not be a healthy old age, that they 
are not just going to live to a point where they all of a 
sudden get sick and die and leave everything to their spouse or 
their families? What can we do to help those folks right now, 
educate them about the need for putting money back as much as 
they can, and looking at their monthly income, not just their 
bottom line: ``Oh, I have got half a million dollars.'' You 
know, that is awesome, but where is that going to be and how 
long might that take to--I will leave that to the panel. Any 
suggestions on that?
    Ms. Stone. Well, I will just start with one comment because 
you mentioned especially with everyone being in savings plans 
now, people do not know how much to save and how much is going 
to be enough, because in the world of Social Security, you get 
a fixed amount a month. If I am saving something, how do I know 
how much money it is really going to take at 65 to be able to 
support the rest of my life? And if I have that lump sum, how 
do I know how much to spend each year? And you are right that 
there is definitely not enough planning around long-term care. 
People somehow still think that that is taken care of by 
Medicare.
    I think truly what is happening is, generationally, people 
who had to deal with their parents get a real wake-up education 
fast, and you hope they change their own behaviors going 
forward, because they are learning through their parents and 
their friends' parents what the story is and how much money 
this really takes.
    I think more education and information to people who are in 
savings plans about how that lump sum actually translates into 
a monthly income can have people either feel good that they are 
saving enough or maybe realize, ``Oh, that is not very much. I 
better start putting some more money away,'' and try to incent 
some savings behaviors.
    Senator Jones. Right. Anybody?
    Mr. Dodaro. I think financial literacy is a real issue in 
this country, regardless of age. Recent surveys from the 
Federal Reserve shows on five basic questions about financial 
matters, people get three out of the five wrong, if not more, 
and so this is a real issue, and many people, four out of ten 
people, cannot even cover a $400 emergency now, and so I think 
on financial literacy, the Government has a role here to help 
empower people.
    The federal government tries to do that through Social 
Security agents, IRS agents, and others, but people do not have 
enough of a resource, and so I think education has to go a long 
way, but the other thing I would say, is that we have called 
for a commission to look comprehensively at retirement security 
in the United States. One of the fundamental precepts that I 
think needs to be done is Congress needs to simplify the 
system. It is way too complicated, and continuing to make 
incremental changes make it even more complicated, so unless 
you both educate and bring up financial literacy and better 
simplify the system, I do not think there is going to be enough 
headway made in time to help people.
    Senator Jones. Great. Well, thank you very much. Real 
quick. I am out of time. Mr. Scott, do you want to say 
something real quick?
    Mr. John Scott. Well, I would just say that, in line with 
the comment about a reexamination of the whole system, I think 
that would help elevate the issue and help understand that, you 
know, your private retirement savings can affect your Social 
Security benefits, so you could use part of your private 
retirement savings for a year, delay claiming of Social 
Security, and increase your benefits by 7 or 8 percent, so I 
think that sort of comprehensive conversation would be really 
useful to a lot of folks, and, just briefly, we have a lot of 
new technology coming online, robo-advisers and artificial 
intelligence, that could help simplify and get the message out 
there to help people through these complicated decisions.
    Senator Jones. Great. Thank you.
    Thank you, Madam Chairman.
    The Chairman. Thank you.
    Senator Braun?
    Senator Braun. Thank you, Chairman.
    I am going to give you an idea what I think besets the 
whole system, and then I have got a couple questions at the 
tail end of it. To me, largely what pales the fact that people 
are not preparing for their future is the underlying ethic of 
savings. You know, I come from an area where it is kind of 
inherently frugal, a German, Catholic community and you were 
taught early on, even out of your wages you made mowing grass 
or something, stick some in the cookie jar or save it. I have 
had a business for 37 years and have been all about the idea of 
trying to make life better for my employees through all the 
tools we have, so I want to come back to a question later about 
the historic--the evidence on how that has changed in terms of 
how people view savings versus consumption.
    The tools we have got to address this would be Government, 
and I look at a statistic here that one-third of the budget was 
being spent on seniors through health care and Social Security 
in 2005. That is going to be 40 percent in 2029. We are running 
trillion-dollar deficits. We have got a balance sheet that 
looks terrible. You know, I come from a finance background. We 
are probably in the poorest position ever as a Federal 
Government to take on big issues like shoring up Medicare and 
Social Security, let alone things like infrastructure.
    I am thinking that one thing that occurred recently was tax 
reform, and for any of us that have had businesses--and I 
preached this on the campaign trail and have done it here--I 
think it is incumbent upon employers to make sure you not only 
expose savings opportunities to your employees, but you 
actually raise 401(k) benefits, invest--if you are a successful 
business and you are paying taxes, invest in your employees, 
because I think the reference was made that real wages have not 
been doing well. I think we are seeing some of that because we 
are unleashing part of the economy that I think can be 
unleashed, but we have got many years to go before that really 
sinks in.
    I am challenging folks that I think have businesses that 
are in the real economy out there to wake up, especially if you 
are successful, invest more in your employees. I do not feel 
confident in looking to Government in its current form of not 
living within its means as being a solution--not to say that we 
should not try to improve there.
    I want to circle back to the ethic of savings. I was 
looking through the notes. I was not here for most of the 
testimony. How much of what we suffer from now where people do 
not seem to be prepared for the future, knowing that Social 
Security has got a lot working against it actuarially and 
demographically, what can you tell me--and this is addressed to 
anyone that would have a special insight into it. What has 
happened since World War II in terms of savings and the fact 
that we obviously are a consumer society--I do not think there 
were credit cards around back then. How much of it is related 
to that versus the fact that, you know, we now see that it is 
not working through Government programs and businesses maybe 
need to do a little more? Anybody that would want to jump in, 
please.
    Mr. Dodaro. I have a chart in my prepared testimony that 
shows the national savings rate and how it has declined over a 
period of time, and it hit a low around the Great Recession 
most recently. It is back up to 6.8 percent, but is nowhere 
near historic levels, so there is a national savings issue that 
needs to be dealt with, but which has a lot of ramifications 
for capital formation and other things beyond retirement.
    Senator Braun. What was it historically, just out of 
curiosity?
    Mr. Dodaro. I think it was around 13 to 15 percent in the 
early 1970s, and now it is about half that.
    Senator Braun. Isn't that the plug-in variable?
    Mr. Dodaro. It is part of the issue. I do not think it is 
totally the issue, but I think it is part of the issue. I think 
another part of the other issue, though, that has to be part of 
the discussion is health care costs. Health care costs are 
eating up into a lot of people's ability to save at all levels. 
As long as health care costs continue to rise faster than the 
economy, which they have, that is going to impede any progress 
for people to try to make accumulate savings.
    Another part of the issue is that because of our economic 
model, a lot time has been spent encouraging people to spend. 
Consumer spending is one of the main drivers of our economy, so 
there is this tension between encouraging people to spend to 
promote economic growth and encourage them to save and deal 
with rising health care costs, so it is complicated, but the 
savings issue is part of the equation.
    Senator Braun. I am glad you mentioned health care costs. 
Another thing we did 9 to 10 years ago in our own business is 
the health care industry, specifically health insurance 
companies, totally dysfunctional. There is a really, I think, 
strong opportunity there to start growing costs out, because I 
think between health care costs and somehow figuring out how to 
get people to save more, look more to the future, would be the 
two things outside of Government that might make the most 
sense.
    Thank you.
    The Chairman. Thank you.
    Senator Sinema?
    Senator Sinema. Well, thank you, Chairman Collins and 
Ranking Member Casey, and thank you to all of our witnesses.
    You know, 10,000 Baby Boomers reach retirement age every 
single day, and many are unprepared for the financial 
challenges they face. An increasingly common challenge is how 
to balance retirement needs with caregiving obligations.
    Recently, a 2018 report from the Center for Retirement 
Research found that more than 10 percent of adults ages 60 and 
over provide some type of care to their own elderly parents, 
and that is what happened to Norma, who is an Arizona educator 
who took early retirement at age 61 to first care for her 
father and then later for her mother, and it also happened to 
Larry, who is an Arizonan with a successful career in 
marketing. He became his mother's caregiver and found his bills 
piling up. In his 70's, he had to take on part-time, low-wage 
work just to make ends meet.
    We know that preparing for retirement is challenging enough 
for many Americans, and those challenges are exacerbated when 
retirees also care for their aging family members. While this 
is often a choice that is made out of love, it can impact 
employment and even Social Security benefits if the caregiver 
must spend years working outside of the working.
    My question today is for Ms. Linda Stone with the Women's 
Institute for a Secure Retirement. Your testimony mentioned 
that retirement protections for caregivers within the Social 
Security system exist, and I previously supported legislation 
to provide tax credits to caregivers, but designing a caregiver 
retirement benefit would be more complicated, so how can we 
shift the conversation around caregiving from talking about it 
as a familial obligation to instead recognizing it as work, 
especially in the context of lost wages and the impact that it 
has on lifetime earnings? And how can we design an earned 
benefit to ensure that it reaches workers like Norma and Larry 
who have made these choices to care for their family members?
    Ms. Stone. I appreciate your questions and your raising 
situations that we hear about a lot at WISER and, you know, 
women having to make these choices, as you said, and the 
ramifications of that. You know, I think from a policy 
perspective, that is not WISER's expertise, so I will leave 
that to all the actuaries and other policy experts around 
Social Security. I will only say that, you know, knowing the 
facts that people do have to spend this many years working but 
not working within work for the Social Security system is 
something that, you know, I would agree needs attention and 
evaluation for how to address that because it definitely 
impacts the ability of large groups of people to be able to 
have a good Social Security benefit as well as to continue 
working to be able to save and get retirement benefits.
    Senator Sinema. My own aunt took early retirement in order 
to have more time to care for my grandmother, who suffers from 
Alzheimer's, and while she still works part-time outside of the 
home, she now is facing a smaller long-term Social Security 
benefit because of the choice she was forced to make in order 
to care for my own grandmother.
    The stories that I hear from Norma, Larry, and, indeed, in 
my own family continue to build and show the pressure that 
Arizonans are facing in the sandwich generation, caring for 
both younger family members and older family members.
    What kind of conversations are happening within the private 
nonprofit community as well as in Government structures to help 
realistically make adjustments for family members who are 
making these very difficult decisions to reduce their 
unemployment to care for family members?
    Ms. Stone. Really, I am sorry. I really cannot speak to 
that.
    Senator Sinema. Are there other members of the panel who 
might be able to address the issues of how to construct a 
benefit that would allow individuals who have taken time off of 
paid work to care for family members to retain the relevance of 
their work in Social Security?
    Mr. John Scott. I would just say that, you know, at Pew a 
different project other than mine is looking into caregiving 
issues, and we would be happy to followup with any information 
we can provide.
    Mr. Dodaro. At the request of Chairman Collins, we are 
doing work for this Committee now looking at this very issue of 
people providing caregiving and what the implications are for 
work. When we have completed our work, we plan to have some 
suggestions in that report associated with that.
    Also, I think more conversation needs to be had. We have 
called for a national commission to be chartered by the 
Congress to look holistically at retirement security in the 
United States. The current system is not well prepared to meet 
21st century needs, and that would be part of that 
conversation, too, so that it could be looked at holistically. 
I think we need to address it more comprehensively, but that 
issue would definitely be part of the conversation.
    Senator Sinema. Thank you.
    Mr. Chairman, I yield back.
    The Chairman. Thank you.
    Senator Hawley?
    Senator Hawley. Thank you very much, Madam Chair, and 
thanks to all of you for being here today to help us understand 
this very important issue.
    I also want to talk about the costs of caregiving, but I 
want to ask some questions about caregiving for children and 
how that affects families' abilities to save and plan for the 
future, but first, let me just pick up on Senator Sinema's 
questions, which I thought were very good and whose concerns I 
share.
    Ms. Stone, in your prepared testimony, you talk about the 
possibility of a provision for Social Security credits for 
those who take significant time, women in particular who spend 
significant time as caregivers. Would you like to say more 
about that? I think that is a very--I think Senator Sinema was 
asking about this. That is an important proposal.
    Ms. Stone. Yes. Well, as I mentioned, I am not getting 
detailed into the policy. WISER and myself was making this 
statement only in that the fact exists, here is what happens 
with women who are taking time out of the workplace to care for 
children or older parents and how can the system address that 
fact without going into any policy details. That is not my area 
of specialty.
    Senator Hawley. Just to pick up on that, it seems to me 
that when we think about care for children, this is a 
significant reason, we know from the data, that women in 
particular choose to, as you say in your prepared testimony, 
Ms. Stone, that women choose to opt for more flexible workforce 
options. They are often still the primary caregiver for 
children, and that, of course, has significant implications for 
savings, and the cost of raising children has significant 
implications for savings.
    I want to ask--I will start with you, Ms. Stone, but direct 
this to the panel. Are there steps that can be taken that we 
should be considering to bring down the costs of raising 
children that would allow for greater savings for families in 
prime earning years when they perhaps have one spouse who has 
reduced his or her workload or is staying home completely to 
care for children and, therefore, their income is down for that 
reason, and just the costs of raising children which continues 
to grow? Are there proposals that you think we ought to be 
looking at to bring down those costs that would allow families 
to save? Ms. Stone, we will start with you and just go down the 
line.
    Ms. Stone. Yes, I am really not aware of anything.
    Mr. St. Peter. I can just speak from an employer, and we 
try to provide as much flexibility to our employees to take 
care of children or elders. We have parameters that we have 
to--with our 401(k) we have parameters of eligibility, and if 
there is--and I do not know exactly what those are, but if 
those could stay within the 401(k) and still be eligible, that 
may be a minor step in the process, but I think just in 
general, trying to be a good employer and provide them as much 
flexibility as we can.
    Mr. John Scott. Well, as a father, I can certainly 
appreciate the question, and I would just repeat that I do not 
really have any specifics to offer today, but this is an issue 
of importance to Pew. It is something that we are studying, 
paid and unpaid care for both children and older parents and 
close ones, so it is something we would be happy to followup at 
a later time when we have some more data.
    Mr. Dodaro. Our current work for this Committee is focused 
on caregiving for parents and spouses, not on children at that 
point, so I would be happy to take a look at that in the 
future, but one of the big issues from a Government standpoint, 
most of the assistance has been provided in the form of tax 
credits, and also the whole issue about education. I think the 
student loan issue not only a parent but a grandparent of seven 
now, I am trying to help my grandchildren prepare for college, 
and that is a huge cost, so there are costs of raising 
children, and there are big costs, and those big costs come 
later on.
    Of course, you have the Medicaid program that allows 
children--you have the CHIP programs for health care costs, 
which are a big component of costs of raising your children if 
you confront a health issue.
    The Federal Government has a lot of issues, but I 
commissioned a special study on was all the programs to help 
children. I am very concerned, as I am with retirement 
security, with the number of children in poverty. The federal 
government does not have a coordinated, comprehensive, 
governmentwide focus on children generally. You are bringing up 
one aspect of that issue in terms of caregiving and the 
implications for the parents, but we have one in five children 
in poverty in this country. In fact, there are more children 
probably in poverty now than the elderly people, and so this 
issue needs a lot broad examination.
    Senator Hawley. Thank you for that. I would just say I am 
very concerned about the number of children in poverty, and as 
it bears on the subject of today's hearing, it seems to me that 
the costs of raising children both in child care and early 
years, the cost of lost income from a spouse or spouses who 
have to stay home or balance the workload that way, and also 
the costs of education is a very significant--I know from 
people in my State whom I have talked to, for families in my 
State, the rising costs of raising children and educating them 
and their health care and their child care is a significant 
barrier to savings that we then see manifest later in life when 
they find they have not been able from their private savings or 
from participation in the workforce to be able to do what they 
would like to do.
    At the same time, of course, we know that the reduced 
number of children, the reduced birth rate, has follow-on 
effects generations later in terms of the number of people we 
have in the workforce who are then able to support those who 
are retired and to support our important programs like Social 
Security and Medicare, so there is a bit of a Catch-22 here 
that I think we are coming to a reckoning with as our society 
ages, as the number of children born to us declines, and as the 
cost of raising children goes up, so these are issues that I 
would like to see us continue to address.
    Thank you all for the important work you are doing, and 
thank you, Madam Chair.
    The Chairman. Thank you.
    Senator Blumenthal?
    Senator Blumenthal. Thanks. Thank you, Senator Collins.
    I want to come back to Social Security, one of the key 
pillars of any retirement financially, and roughly half of 
seniors rely on Social Security for 50 percent of their income. 
One in five rely on it for 90 percent. Women are even more 
dependent on it generally than men, and many are living in 
poverty, but the news is not great looking to the future. As 
you say in your report, by--and I am going to read it to get it 
right, ``current projections indicate that by 2034, the Old-Age 
and Survivors trust fund for Social Security's retirement 
program . . . will only be sufficient to pay 77 percent of 
scheduled benefits . . .'' That is a really startling 
statistic, and it is not sort of, well, if everything goes 
right or wrong. That is the reality, and for the first time, in 
2005 Social Security is paying out more than it is taking in.
    We are talking about all kinds of issues here that involve 
education and awareness and savings, but one of those key 
pillars very much within our direct control is Social Security, 
so the question is: What do we do?
    I have introduced legislation--it is called ``Social 
Security 2100"--along with Chris Van Hollen, my colleague here; 
John Larson in the House. We have really developed a complex 
and I think sophisticated approach that, in effect, increases 
the benefits that are going to be received to keep pace with 
the cost of living, not to reduce it. Far from it, to increase 
the benefits, but at the same time make it financially solvent 
through a series of changes in the tax structure and raising 
taxes, in effect, for people who earn more than $400,000--I am 
not going to ask for a show of hands here, but my guess is a 
very small number in this room and generally in the American 
public make more than that amount--and really to update the 
Social Security system.
    I would like to hear from the panel--after that somewhat 
long-winded introduction but incomplete because there is a lot 
more to say about Social Security--what you think about the 
importance of this kind of reform.
    Mr. Dodaro. I think it is essential to reform the Social 
Security system. I mentioned that the Social Security Old Age 
and Survivors Trust Fund will have only enough to pay 77 
percent by 2034, but just to give you an idea of the magnitude 
of the issue, the net present value, the difference between 
expected expenditures for Social Security and revenues coming 
in over the next 75 years is $16.1 trillion, expenses over 
revenues, so you would have to make up that amount of money. 
Another way of looking at it, you would have to increase 
payroll taxes by 2.84 percent to cover that gap.
    There are obvious policy decisions. There are benefits 
versus revenues, but you have a very significant issue here, 
and then if you think about in the Medicare program net present 
value of the projected deficity over the next 75 years is $38 
trillion, so if you look at Social Security and Medicare 
combined, the program is facing a $54 trillion deficit in 
funding for those programs based on their current arrangements 
over the next 75 years. This is a huge cost, and there are 
alternative estimates for Medicare, if health care costs go 
higher, that number could go even higher over that period of 
time.
    This is one of the factors driving the overall deficit 
situation in the Federal Government. Right now, as of Monday, 
the national debt stood at $21.9 trillion, and the interest 
costs on that debt are rising and by 2028 it is projected to be 
over $900 billion a year just paying interest on the debt, so 
there is a very serious long-term fiscal problem, and Social 
Security and Medicare are a central part that need to be dealt 
with in order to deal with this situation.
    Senator Blumenthal. Well, I would just point out, because 
my time has expired, put aside the Federal deficit, I am deeply 
alarmed about it. A number of us have raised important 
objections to the so-called tax reform to deficit spending in 
the budget because of it, but Social Security is a trust fund, 
and we have an obligation to make it solvent, and the costs of 
living, apart from the cost of medicine alone--and maybe we can 
do more to bring down the cost of pharmaceutical drugs and 
other costs of health care, but the cost of living we know is 
going to rise, and right now a lot of seniors will not be able 
to rely on Social Security to stay out of poverty, and I think 
that is something very much within our control. We need to 
address it now.
    Mr. Dodaro. I agree.
    Senator Blumenthal. Thank you.
    The Chairman. Thank you.
    Mr. Dodaro, I want to followup on a Social Security 
question also. Increasing the minimum Social Security benefit 
may be one option that Congress should examine to protect low-
income beneficiaries who have little else to live on. I was 
surprised, as I started looking into this concept, to learn 
that the Social Security Administration's distribution analysis 
showed that raising the minimum benefits could also raise the 
benefits of many who are not actually low-income because they 
may, for example, be married to a high-earning spouse.
    Do you have any thoughts preliminarily on what could be 
done to ensure that any increase in the minimum benefit, which 
I am inclined to think is a good idea, is targeted to just low-
income beneficiaries and that it does not have this impact that 
we see in the analysis that SSA has done?
    Mr. Dodaro. I would be happy to take a more detailed look 
at that and give you some more detailed suggestions, but 
preliminarily, in our look at this issue, one of the key 
issues, I think, would be to try to understand from Social 
Security how many people actually receive the minimum benefit. 
It has been a number of years since we looked at that issue, 
but the last time I think it was 2013. There were very few 
people who were at the minimum benefit. Most people with a 
spousal benefit, assuming your spouse did the right thing and 
you had that option, have a much higher beneft than the minimum 
amount.
    I think the first thing to do is where should the minimum 
be if you want to adjust the minimum to make a meaningful 
difference. Then once you do that, the analysis that we have 
looked at quickly for Social Security shows that there are some 
high-income earners who would benefit from this, particularly 
those that have investment income, and so the difference would 
be to try to focus on earnings versus total income as a means 
of trying to keep it more targeted to the lower-income people, 
but we can study this a little bit further and give you some 
suggestions in that area, but those are two things I would 
suggest.
    The Chairman. Thank you. That is very helpful, and I 
appreciate your offer to do some additional work for us in that 
area.
    Mr. Scott, you discussed the challenges facing workers 
without employer-sponsored plans, and, understandably, it tends 
to be smaller businesses that are less likely to offer these 
plans.
    What does your research show would prompt smaller employers 
to offer retirement plans?
    Mr. John Scott. That is a really, really good question and 
an important question, because we do know that the coverage is 
very low among small employers. I think the focus we have seen 
from our research is on the high cost of starting a plan, the 
sort of lack of internal administrative capacity or bandwidth 
to operate a plan. These are business owners who are, you know, 
doing more than one thing with their companies, and I think 
also just the lack of awareness of plan options. As I said in 
my testimony, only 11 percent are very familiar with SIMPLE 
plans and other options that are specifically designed for 
small business. Many are not aware of the existing tax credit 
for startup costs.
    I think there are a number of things in terms of just 
raising awareness and helping them--you know, giving them the 
tools to start plans. You know, in our conversations in focus 
groups of small business owners, they want to do the right 
thing. They want to help their employees save for retirement. 
They told us that repeatedly, but I think they really just 
need--you know, so the motivation is there. I think they really 
just need the tools and awareness of what is available to them 
that works for their business.
    The Chairman. Thank you.
    Mr. St. Peter, you have illustrated how in just 10 years 
your company really transformed its retirement savings options 
for your workers, and it is a remarkable success story for a 
business that has only about 100 employees. That, by the way, 
in Maine is a pretty good-sized business, but from your 
perspective on the ground, how can we encourage other small 
employers to take the same kind of steps you did to offer 
matching contributions, which seems to have been the key in the 
transformation of your plan, and take other steps to offer 
retirement savings programs?
    Mr. St. Peter. Yes, I agree with you. I think our matching 
component of the best practices that we implemented was the 
reason we were so successful. Any incentives that you can 
provide to businesses, tax-wise or other, education---I think 
education and outreach is really important, so I am not sure 
what the best instrument is there, but utilizing local Chambers 
of Commerce or other organizations that are in place.
    I really like what I heard about the multiple-employer 
plans and removing the nexus requirement, I think that would go 
a long way. Within our engineering consulting industry, we have 
at least one association we could use for a multiple-employer 
plan, but if you remove that nexus requirement, you get someone 
like a Chamber of Commerce or other entities that are already 
in place to form some of these multiple-employer plans, I think 
that would go a long way.
    The Chairman. Thank you very much.
    And, Ms. Stone, your testimony was excellent. I deferred to 
Senator Casey to lead the questioning on you, but I do 
appreciate your testimony as well.
    Ms. Stone. Thank you.
    The Chairman. Senator Casey.
    Senator Casey. Thank you, Chairman Collins. I will actually 
ask a similar question or along a similar line about access to 
retirement plans that work.
    Ms. Stone, we know that is a problem, obviously, for part-
time workers as one category; small employers, as Mr. St. Peter 
was talking about, and the ways he and his company have 
confronted this challenge. Workers in low-wage industries might 
be another example.
    Can you speak more to how difficult it can be for workers 
with no access or very limited access to workplace retirement 
plans to save and how we can bring more workers into workplace 
plans, how that could help?
    Ms. Stone. Well, I think, as you mentioned, it is very 
difficult for somebody who does not have access to a workplace 
plan to try to figure this out for themselves, even if they 
want to save. You know, what is an IRA? How do you do that? Can 
I trust that person? How do I pick the investments? There is 
something about the structure of a workplace plan that gives 
people more assurance as well as providing the means and, 
frankly, the discipline to do ongoing savings.
    We know from some of the work that WISER has done with 
child caregivers in Appalachia, so very, very low-income women, 
that if you give an incentive to save and put something in 
place, they want to save. You know, women want to save, and so 
I think it is getting to the access to a plan. There is, what, 
30 percent--we heard some numbers today--of private sector 
employees who have no access to a workplace retirement plan, so 
if something could be put in place that they would have access 
and also perhaps to reflect the fact that many women are 
working part-time and that cuts them out of participating in a 
plan that has a thousand-hour requirement, can we do something 
to change those participation requirements so women who are 
working perhaps consistently on a part-time basis can have 
access to a workplace plan and be able to save?
    Senator Casey. The last question was about more of a 
demographic focus. I think it is still the case that the 
fastest-growing population is 85 and up overall, and in your 
testimony you talked about that there are 5.7 million more 
women than men at age 65, but you also said 67 percent of the 
over-85 population are women, so basically two-thirds of 
everybody over 85 is, in fact, a woman.
    I have introduced legislation the last Congress--actually, 
Senator Wyden and Senator Brown and I introduced a bill that 
would strengthen Social Security benefits for the oldest among 
us and for those receiving particularly low benefits. Walk 
through, if you can, both the risks and the challenges that 
face retirees, especially those who live to that advanced age.
    Ms. Stone. Well, as I had mentioned, when you are over 85, 
most of those--the majority of those folks are women. Many of 
them at that point are alone and living alone. They are not 
married at that point, and so they have spent time caregiving 
for their spouses, oftentimes using up the assets, the savings 
that they did have, and so when it comes time for their time, 
you know, it is less likely that there is a family person to 
take care of them, so they have to pay for assistance, and we 
also heard mention today, you know, of the cost of long-term 
care and what that can do to somebody's financial security when 
you have a shock like that that is unexpected, and so it is 
this group that is most likely to end up in poverty, and what 
was telling to me was they end up in poverty even though they 
have not been poor or near-poor in their life. It is just the 
circumstance of the longevity and no one expecting to live that 
long and not being able to plan to live that long, having very 
low Social Security benefits, and, frankly, at that point 
little or no assets to draw upon.
    Senator Casey. Thank you.
    Thank you, Madam Chair.
    The Chairman. Thank you.
    Senator Braun?
    Senator Braun. Thank you, Madam Chair.
    Senator Blumenthal mentioned Social Security. I think that 
is so important because it is a structural thing that most 
people end up depending on when it comes to retirement. I 
disagree with the fact that--you know, he was talking about 
raising revenues. As an employer and knowing what the 
percentage is currently that employees and employers pay into 
it, I think you are going to have a tough time having that 
sell. You know, he mentioned tax reform. That, according to 
CBO, was, I think, $150 billion per year, $1.5 trillion over 10 
years, and in the Budget Committee the other day, I asked 
Director Hall, and he said, you know, he did not agree with the 
fact that it is revenue neutral so far, but he said you at 
least need to look at the fact when you are growing 3 percent, 
tax reform, you know, might be closer to neutral than negative 
on the deficit--my point being it goes back to employers, you 
know, having that extra capacity paying less to the Federal 
Government, so I think anybody out there that is an employer, 
look at enhancing your 401(k). Take on your health insurance 
issues. We did it. You could lower costs dramatically, but you 
have got to take risks and have the nerve to do it, lowering 
health care costs, which is such a big deal because the 
Medicare component was as lot larger than Social Security, so I 
think that those are the angles that are going to work better 
than what the Senator was referring to.
    Here is something in health care. Senator Paul has talked 
about it, I believe it is necessary: pooling and associating so 
you do not have individuals stranded out there with the poorest 
buying power possible to try to get, you know, good advice and 
any of the economy of scale that would come from having 300, 
500, 1,000 employees.
    Is pooling and association, which has been kind of loath 
for health care to embrace, which they should? What about 
financial services? Maybe Mr. Scott or whoever would have some 
knowledge. Is that percolating out there to help individual 
folks planning for retirement?
    Mr. John Scott. Yes, I think there is a lot of interest in 
taking a pooled approach or an association approach to 
retirement savings, offering retirement benefits through sort 
of a pooled approach. I think, you know, in our polling, our 
survey work around the issue, we did raise the topic of 
multiple-employer plans, which is one pooled approach, and 
there is a lot of interest in that. A lot of the small business 
owners expressed or said that it would be very useful to them 
if they could sort of join in a multiple-employer plan.
    Of course, it is still voluntary. They still have to sort 
of make that decision individually if it makes sense from a 
business perspective to join in, so it is not clear if they 
will at the end of the day, but I think that is certainly an 
important option to be considered.
    Senator Braun. Do you see much of that happening out there? 
Is the impetus going to have to come from employers to push it? 
Or do you think the financial services industry will reach out 
to what to me looks like a big market to try to get an economy 
of scale there?
    Mr. John Scott. Yes, it is a really good question. I think 
Mr. St. Peter mentioned that, you know, there is some interest 
within the Government in terms of expanding the opportunity to 
join in multiple-employer plans, so you know, we are looking to 
see if there will be any guidance from the Department of Labor 
on this particular issue.
    Then, of course, it is a question of whether the financial 
services industry will put together the products. You know, 
retirement plans are sold to employers, so they will have to 
follow through on their end to construct pooled products that 
make sense for the individual business owner.
    Senator Braun. Thank you. Anybody else want to weigh in? Go 
ahead.
    Mr. St. Peter. Just a couple things. We have acquired some 
small firms in the last 5 years. Two of them had SIMPLE plans; 
one of them had a 401(k) profit plan, I think underachieving 
the success that we are having now, now that we are bigger,and 
then on health care, we did pool with our association, ACEC, 
and it was very successful for us for many years for our health 
care insurance.
    Senator Braun. When did you start that?
    Mr. St. Peter. It was probably 5 years ago. The funny thing 
is we did just opt out of it to another plan, but during those 
5 years, it was very successful for us.
    Senator Braun. Measurable cost savings by doing it?
    Mr. St. Peter. Very, very much.
    Senator Braun. Good.
    Mr. St. Peter. We have also implemented--not the H.R. 
director. We share deductibles. I think it is HRA, so it is a 
bit of self-insuring ourselves. We have higher-deductible 
plans, HSAs with an HRA to help share the cost of that 
deductible and out-of-pocket expense, and that has been very 
successful for us, too.
    Senator Braun. Good. I am out of time. I yield back.
    The Chairman. Thank you so much.
    I would like to thank all of our witnesses for testifying 
today and sharing your analysis, recommendations, and insights 
on how Americans can better prepare for a secure retirement 
today and for generations to come. Your ideas, your expertise, 
your knowledge is extremely valuable to our Committee as we 
continue to work on how we can improve retirement security for 
all Americans.
    I believe that this is an issue that Congress must grapple 
with, and yet it really has not received much attention despite 
all the red flags and warning signs that we are seeing.
    This week, as I mentioned in my opening statement, I 
introduced two bipartisan bills that would better promote 
greater retirement security. Together, the Retirement Security 
Act and the SIMPLE Plan Modernization Act would encourage more 
employers to offer retirement plans and provide incentives for 
employees to save more for their own retirements.
    The frustration that I feel is we know this crisis is 
looming. We know that the three traditional pillars of our 
system--Social Security, pension plans, and personal savings--
are all three on very shaky ground, and yet it is an area that, 
because it is so difficult, Congress has tended to shy away 
from tackling what is a very important challenge, particularly 
given the changing demographics of our country with people 
living far longer and our population growing older.
    This will remain a major focus of our Committee. I 
appreciate the work that Senator Casey has done as well, and I 
want to thank our staff, which has done an excellent job in 
putting together this hearing. That is always key to a 
successful hearing.
    Committee members will have until Friday, February 15th, to 
submit any additional questions for the record, so some may be 
coming your way. I appreciate the fact that many of you have 
offered to keep in touch with the Committee and continue to 
assist us with our work on this important topic.
    Senator Casey?
    Senator Casey. Thank you, Chairman Collins, for the hearing 
on this critical issue.
    We have heard from our witnesses about our Nation's 
retirement system that works well for some but, as I said 
earlier, lets many others fall through the cracks. We do have 
to work together, as the Chairman said, to address the 
shortcomings of our retirement system. Part of that, of course, 
is strengthening Social Security and ensuring it keeps the 
promise of financial security in retirement. Part of that I 
think would be passing legislation like my bill to help both 
widows but also widowers because of the arcane and destructive 
claiming rules and other problems with the system.
    We have got to take action to ensure that workers depending 
on pensions that they have earned are not left struggling to 
make ends meet in their retirement years. We have got to work 
to improve access to retirement plans and to Government 
incentives to save so that our retirement system is serving 
every worker and not just some.
    So we look forward to continuing this work, and I want to 
thank our colleagues on the Committee, Chairman Collins, and 
also, of course, our witnesses for being here. Really a good 
education for all of us.
    Thanks very much.
    The Chairman. Thank you. This hearing is now adjourned.
    [Whereupon, at 11:14 a.m., the Committee was adjourned.]

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                                APPENDIX

  
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                      Prepared Witness Statements

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                       Statements for the Record

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