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The Complementary Roles of Social Security and Personal Savings

September 1, 2008  • Institute Contributor

With the release of the latest Social Security Trustees report on the status of the Social Security trust funds, many are again trying to pit private savings in opposition to Social Security. According to IFS Executive Director Lisa Mensah, that is off base.

At a recent forum sponsored by the National Academy of Social Insurance (NASI), Mensah noted that while too many discussions become bogged down in an ideological debate over Social Security privatization, the real discussion should about how to make retirement more financially secure for more Americans. She argued that the answer is to build on Social Security with private retirement savings and annuities.

 Mensah discussed two IFS proposals. The first – America’s IRA – would put savings within reach of the majority of working Americans who do not have access to a pension plan at work. The second – Security Plus Annuities– would offer older Americans an additional layer of lifetime, guaranteed income as a complement to Social Security.

Click here to read the congressional testimony on these two proposals by Pamela Perun, IFS Policy Director.