On October 30, 2015, the Schwartz Center for Economic Policy Analysis (SCEPA) co-hosted a conference with the Center for American Progress on How Tax Reform Can Address the Incoming Retirement Crisis. We discussed the erosion of American's retirement security and how the tax code can be used to encourage retirement savings.

Retirement tax expenditures are the second largest federal tax expenditure, costing roughly $100 billion per year and growing. They are ineffective and regressive. Rather than encourage savings, they incentivize the well-off to shift their savings to tax-exempt accounts. The top 20% of earners reap 60% of the benefits of these expenditures, while the bottom 40% of earners see only 3%.

In light of the crisis in retirement savings--one quarter of workers aged 50-64 have no retirement savings whatsoever--we believe this money could be put to better use. If it were converted to a credit and divided evenly among the population, it could provide over $600 per year to Guaranteed Retirement Accounts. Add to that state retirement tax expenditures, and you can make an impact in the retirement security of low-income and middle-class Americans.