Mike Crapo Raises Concern About Creating ‘Another Unsustainable Govt Program’ With Saving Plans

4 months ago

During a Senate Finance Committee hearing on Tuesday, Sen. Mike Crapo (R-ID) gave opening remarks about savings accounts for young Americans.

Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:

https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript

Stay Connected
Forbes on Facebook: http://fb.com/forbes
Forbes Video on Twitter: http://www.twitter.com/forbes
Forbes Video on Instagram: http://instagram.com/forbes
More From Forbes: http://forbes.com

Transcript

00:00 Thank you, Mr. Chairman. Today's hearing provides an important opportunity to examine the ways

00:05 working families can save their hard-earned income for their children's future. Only two

00:12 years ago, this committee and others worked together in a bipartisan, bicameral fashion

00:16 to expand retirement savings through the Secure 2.0 Act. As we continue to monitor its implementation

00:25 and the effects the law had on retirement savings, it's appropriate for us to explore other savings

00:30 needs beyond just retirement. Fortunately, Americans already have access to numerous

00:37 savings options, whether it is saving for a specific purpose through a tax-advantaged account

00:43 or saving through traditional savings vehicles. Tax-advantaged accounts allow benefits such as

00:50 tax-free growth and withdrawals, making it easier and more efficient to save for a specific purpose.

00:57 For example, 529 accounts can help families save for their children's education experiences.

01:03 Health savings accounts and flexible spending arrangements can be used to help eligible

01:09 individuals save for medical expenses. Dependent care FSAs can help workers save expenses for

01:18 dependents, such as after-school or in-home care for kids or other family members. And ABLE

01:26 accounts help those with disabilities save for critical tools like assistive technology

01:32 and transportation, to name just a few. Beyond these tax-advantaged accounts, Americans can also

01:39 save through widely available traditional means, such as savings and brokerage accounts.

01:46 And for children specifically, custodial accounts and even some child-specific accounts offered by

01:52 some institutions can help teach children the ins and outs of saving. When paired with proper

01:58 financial education, more children and young adults can learn how to budget and save from an

02:04 early age, carrying best practices on into adulthood. Any discussion concerning the

02:11 options to save go hand-in-hand with a conversation on the importance of planning

02:16 and managing savings throughout one's life. Part of that planning includes the need for many to

02:24 consider seeking professional financial advice in order to create comprehensive savings strategies.

02:31 Although families have access to many savings vehicles, navigating this often complex web of

02:38 options can be daunting, and every family's needs are different. Whether a family is saving for a

02:45 down payment on a home, or planning ahead for unforeseen emergencies, or health expenses,

02:52 understanding what options are available is key. Effective planning becomes even more important at

02:59 a time when Americans are experiencing inflation at levels not seen in decades.

03:05 Higher costs of food, fuel, and housing eat up families' disposable income

03:10 and squeeze their ability to save. In fact, as compared to January 2021,

03:18 average U.S. households are spending over $1,000 extra each month just to maintain

03:27 their standard of living. Today's witnesses will discuss all of these topics,

03:33 and I look forward to hearing how Congress can expand opportunities to save in a fiscally

03:39 responsible manner. I also expect to hear testimony on child savings initiatives that

03:46 some states have implemented. While I respect the steps some states are taking, implementing a

03:52 similar program at the federal level would come at a significant cost to taxpayers. Expanding

03:58 options to save is a worthy goal, but we must do so in a way that does not exacerbate already

04:05 out-of-control government spending or create another unsustainable government program.

04:11 To all of our witnesses, thank you for being here. I look forward to hearing your testimony.

04:17 Thank you, Mr. Chairman.

04:17 Thank you.

Mike Crapo Raises Concern About Creating ‘Another Unsustainable Govt Program’ With Saving Plans

Category

Transcript

Recommended