[Congressional Record Volume 141, Number 16 (Thursday, January 26, 1995)]
[Extensions of Remarks]
[Page E182]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                       THE ``SUPER IRA'' PROPOSAL

                                 ______


                         HON. WILLIAM M. THOMAS

                             of california

                    in the house of representatives

                       Wednesday, January 25, 1995
  Mr. THOMAS. Mr. Speaker, I am very pleased that a consensus is 
finally emerging in favor of restoring the utility of Individual 
Retirement Accounts. President Clinton wants them back and so do many 
Members of this body.
  As the sponsor of the House super IRA proposal being introduced today 
and the cosponsor of prior bills, I have long felt we need to give 
ordinary Americans more reasons to save for their own retirement. The 
Individual Retirement Account is one of the best savings incentives we 
have ever developed.
  The need to expand savings is clear. Americans typically save less 
than people in other countries and the effect of their habit is clear. 
A Merrill Lynch survey shows half of American families have less than 
$1,000 in net financial assets. Even those within 10 years of 
retirement (ages 55 to 64) only have $6,880 in net financial assets 
such as checking, savings, IRAs or 401(k) savings.
  Another survey shows that the 76 million Americans in the Baby Boomer 
group are saving at rates far below what they need to maintain their 
standard of living after retirement. When we consider the prospect that 
Social Security may run out of funds early in the next century, the 
security of the Baby Boomers looks poor indeed. We need to develop 
savings incentives that will make them more secure. I strongly support 
the use of the Individual Retirement Account for that purpose.
  A 1991 Money Magazine reader survey shows how popular the super IRA 
truly is with the people we want to serve. 97 percent said they would 
contribute to IRAs if IRAs were restored; the remaining 3 percent were 
largely already retired. People made it clear they would contribute new 
savings to their IRA. IRA popularity cut across all income groups.
  The Super IRA gives Americans an opportunity to have deductible IRAs 
or an IRA Plus account in which earnings would be tax-free. The super 
IRA, with its elimination of the 10 percent early withdrawal penalty 
for withdrawals for education, medical costs, buying homes, long-term 
care and times of unemployment, provides a savings vehicle which gives 
working families the liquidity they want and may need. With both 
parties now endorsing the IRA as a means of helping middle income 
Americans, I hope my colleagues will join me in cosponsoring the Super 
IRA.


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