Nationwide applauds pension reform
Enactment makes saving and generating retirement income easier
FOR IMMEDIATE RELEASE
August 4, 2006
Contacts:
Jennifer Monnin (614) 677-5391
monninj@nationwide.com
Jeff Botti (614) 249-6339
bottij@nationwide.com
Columbus, Ohio — With the face of retirement in America rapidly
changing, Nationwide Financial Services, Inc. (NYSE: NFS) today applauded
the passing of the Pension Protection Act for addressing some of
the
country’s new public policy needs.
“The three-legged stool Boomers were promised at the start of their careers – traditional pension plans, Social Security and personal savings – has left many Americans on shaky ground,” said Mark Thresher, Nationwide Financial president and COO. “The legislation passed last night will help many Americans start moving toward a more sure-footed retirement with easier ways to save and to generate guaranteed lifelong income.”
The legislation, co-sponsored by Education and the Workforce Committee Chairman John Boehner, R-Ohio, and Ways and Means Committee Chairman Bill Thomas, R-Calif., has among its provisions:
Automatic Enrollment – One in four workers covered by a 401(k) plan does not participate. Yet according to Employee Benefit Research Institute, 40 percent of non-participants would be very likely to stay in a plan if their employer automatically enrolled them. Today’s legislation changed the legal environment to help plan sponsors make it easier for their employees to start saving.
Safest available annuity standard – By encouraging plan sponsors to offer annuities as a direct distribution option, it will be easier for Americans to turn their retirement plan savings into lifelong income. In short, it allows 401k plan assets to be paid out more like a traditional pension plan upon retirement.
Permanency of Contribution Limits – The legislation makes permanent the higher contribution limits Americans can make toward their employer-sponsored retirement plans. This makes it easier for Americans to more adequately prepare for retirement, especially for those who need to catch up on their savings as they near retirement.
“This legislation offers many improvements, but it does not remove retirement policy from the forefront of our national discussion,” Thresher added. “As our society ages and sources of retirement income change, policymakers and business leaders should do more than just prevent a crisis; we should develop a comprehensive policy that helps retirees in their continued pursuit of their retirement dreams.”
About Nationwide Financial®
Nationwide Financial Services, Inc. (NYSE: NFS), a publicly traded company based in Columbus, Ohio, provides a variety of financial services that help consumers invest and protect their long-term assets, and offers retirement plans and services through both public- and private-sector employers.
It’s part of the Nationwide group of companies, which offers diversified insurance and financial services. The group is led by Nationwide Mutual Insurance Company, which is ranked No. 98 on the Fortune 100 based on 2005 revenue.1 For more information, visit www.nationwide.com.
1 Fortune Magazine, April 2006
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Investments Retirement Insurance nationwide.com One Nationwide Plaza Columbus, OH 43215-2220
