September 09, 2016

Scott, Warren Highlight GAO Study on 401k Annuity Options for America's Workers

GAO's findings underscore the importance of working people having access to investment advice that's in their best interest

Washington, DC- Today, Congressman Bobby Scott (D-VA) and Senator Elizabeth Warren (D-MA), released the findings of a new report by the Government Accountability Office (GAO) they co-requested on the challenges working Americans face in making their 401(k) savings last throughout retirement. ‎Specifically, GAO analyzed whether employers' 401(k) plans provided workers with appropriate options to annuitize their savings-of the plans GAO surveyed, very few of them offered such options. GAO made several recommendations to the Department of Labor that would make it easier for employers to offer annuitization options in their 401(k) plans. Additionally, ‎as part of its survey, GAO heard from workers that investment advice is a "key factor in implementing a sound retirement strategy".

"Americans must have access to quality retirement plans so they do not outlive their hard-earned savings," Congressman Scott said. "The GAO's report shows that too few workers have access to a cost-effective option to annuitize their savings. GAO also highlighted that Americans believe investment advice is a key part of a sound retirement strategy. That's why Senator Warren and I have been championing the Department of Labor's fiduciary rule, which provides that such investment advice is actually in workers' best interest."

"With rising costs and flat wages, it's harder than ever for Americans to save for their retirement. Those Americans who do manage to save in workplace retirement accounts like 401(k)s are then confronted with decisions about how to make sure that money lasts throughout their retirement," said Senator Warren. "Today's GAO report highlights the importance of making sure Americans have access to good investment advice when making these decisions. And thanks to a new rule by the Department of Labor, workers can now rest easy knowing that every adviser they meet will be recommending products because they are in their best interest, not because the product nets higher fees for the adviser."

To read the full GAO report click here.