[Congressional Record Volume 155, Number 86 (Wednesday, June 10, 2009)]
[Extensions of Remarks]
[Pages E1368-E1369]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          INTRODUCING THE RETIREMENT SAVINGS TRANSPARENCY ACT

                                 ______
                                 

                          HON. SUSAN A. DAVIS

                             of california

                    in the house of representatives

                        Wednesday, June 10, 2009

  Mrs. DAVIS of California. Madam Speaker, I rise today to introduce 
the Retirement Savings Transparency Act.
  More than ever, Americans are relying on 401(k) plans to finance 
their retirements. Almost 50 million Americans have invested 
approximately $2.7 trillion in 401(k) retirement plans.
  Yet a recent study by the Government Accountability Office (GAO) has 
found that over 80 percent of Americans do not know what kind of fees 
are being charged on their hard earned retirement savings.
  But even small differences in these 401(k) fees can lead to 
significant reductions in the amount of money retirees can expect to 
see.
  For example, an increase of only one percent in 401(k) fees can lower 
a retiree's savings by over $32,000 over the course of a 30-year 
period.
  The same reductions can take place because of even minor differences 
in the rates of return on a 401(k) investment portfolio.
  One of the most persistent barriers to workers understanding their 
retirement options is the failure of financial disclosures to put these 
fees and returns in context.
  When they are provided with information on fees and returns, 
consumers often have no frame of reference to which to make 
comparisons.
  Yet these benchmarks are readily available in the marketplace and are 
regularly used by institutional investors in making their investment 
decisions.
  I believe we need to make these same benchmarks available to all 
Americans saving for retirement.
  We have an obligation to help workers make informed decisions when it 
comes to their precious retirement savings.
  The legislation I am introducing today would provide workers with 
appropriate points of comparison for both the fees and returns 
associated with each investment option in their 401(k) accounts.
  This will help Americans better understand their investment options 
and make the right decisions to maximize their retirement savings.
  At the same time, the increased transparency in fees and returns will 
force plan providers to compete, driving down costs and increasing 
returns.
  During the tough economic climate, Americans have already seen their 
retirements decline. Many retirees have seen their nest eggs

[[Page E1369]]

evaporate and some are even being forced to go back to work after 
retirement.
  It is even more important now than ever to help Americans squeeze 
every penny out of their retirement investments.
  I hope we will pass this important legislation and empower Americans 
to make the most of their hard earned savings.

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