CU groups support savings initiative

WASHINGTON-Congressmen Rob Portman (R-Ohio) and Benjamin Cardin (D-Md.) have reintroduced their bill to increase permissible Individual Retirement Account (IRA) and 401(k) contributions with an allowance for persons over 50 to catch up and simplify current pension law complexities. Credit unions have rallied behind H.R. 10, the Comprehensive Retirement Security and Pension Reform Act, for passage in the 107th Congress. "Given that the national savings rate is at an all-time low, passage of this bill would be an important step in ensuring overall financial self-sufficiency for all Americans, as well as a greater degree of economic independence for those of retirement age," CUNA President and CEO Dan Mica wrote in a letter distributed to all members of the House early last week. "NAFCU is very much for promoting savings," NAFCU Lobbyist Murray Chanow said. NAFCU President and CEO Fred Becker spoke at length at their 2000 Congressional Caucus on the importance of increasing savings. The legislation enjoys the support of not only credit unions and other financial service providers, but also 256 co-sponsors in the House, Chanow said. The bill was passed by the House in the 106th Congress, but the legislative clock ran out as it sat in the Senate. The legislation would increase the IRA contribution level from $2,000 per year to $5,000, which is approximately equal to the inflation rate since the original limit was set in 1981. The legislation would also index the cap for inflation. Additionally, the 401(k) contribution limit would jump from $10,500 to $15,000. This would "greatly enhance the retirement security of all working Americans," Mica wrote. CUNA and NAFCU also both supported the legislation last congressional session. -scooke@cutimes.com