Addressing the White House Conference on Aging this week, President Barack Obama outlined his top priorities for enhancing retirement security for aging Americans, which includes modernizing Social Security, reducing conflicts of interest in the retirement investment marketplace and incentivizing states to establish work retirement plans.
Every day 10,000 baby boomers turn 65 or 250,000 every month, he began. Medicare and Social Security are not in crisis, but they are facing challenges because of these demographic trends.
He said “too many Americans leave the work force without having saved enough for a dignified retirement. It’s not as if they haven’t tried. There are a lot of people who work really hard, but at the end of the day still don’t have enough in their nest egg. Most workers don’t have a traditional pension that guarantees them a certain amount every year once they retire. And Social security, on its own, is not enough.”
To help solve the retirement funding crisis, the President said “we first need to keep Social Security strong and protect its future solvency,” although he didn’t elaborate.
For hard-working Americans who save for retirement, “let’s make sure they get a fair deal,” before he summarized a Labor Department proposal to crack down on conflicts of interest in retirement advice. “The goal is to put an end to Wall Street brokers who benefit from back-end payments or hidden fees at the expense of their clients,” said President Obama. “If they are advising you on how to save your money, they should be looking out for you and not for somebody who is trying to sell a product that does not benefit you. For many brokers who are doing the right thing, this rule levels the playing field for them and their customers.”
America also needs to make it easier for people to save for retirement. One-third of American workers do not have access to a retirement plan at work.
A handful of states have passed laws creating new ways for people without a workplace plan to save for retirement. And more than 20 states are thinking about doing the same. The President said, “We want to do everything we can to encourage states to take this step. I’ve asked the Department of Labor to propose a set of rules by the end of the year that provides a clear path for states to create retirement savings programs. If every state did this, tens of millions more Americans could save for retirement through work.”
Other policies proposed by conference delegates that the President said he will explore further include:
- making it easier for home-bound seniors to get nutritional assistance
- updating quality and safety requirements for thousands of nursing homes, the first major overhaul in 25 years
- training more prosecutors to combat elder abuse
- working with Congress to reauthorize the Older Americans Act
- promoting workplace flexibility and family leave policies within the federal government and the private sector that support workers who are also caregivers for aging parents, which the President said “creates more loyal and productive employees and reduces turnover rates.”
On the healthcare side, President Obama said that since the Affordable Care Act was signed into law, the government has extended the life of the Medicare Trust Fund by 13 years.
“We’re moving Medicare toward payment models that require quality of care instead of quantity of care as the measure for how you get paid. That is something that will keep older Americans healthy, and Medicare healthy as well,” he said. “The law has also saved Medicare recipients $15 billion in prescription drug costs. Built into the Affordable Care Act, 9 million seniors have received significant discounts on their prescription drugs. And we have expanded access to home and community-based services offered by Medicaid, which means more older Americans are able to make the same choice my grandmother did and live independently.
The goal is not to cut back on services. “The goal,” he said, “is to make sure that retirees are getting more of the services that they need and less of the services they don’t, thus ensuring the government has more money left over to do more stuff that will keep people healthy and active.”
The White House has held a Conference on Aging each decade since the 1960s to identify and advance policies that improve older Americans’ quality of life. To get more information on the conference, visit http://www.whitehouseconferenceonaging.gov. To view the President’s 19-minute speech, visit https://www.youtube.com/watch?v=3i5y5ol9GEM.