Good morning. I want to discuss with you steps we are taking to help strengthen
the retirement security of America's workers. More than 40 million Americans
save for retirement through 401(k) accounts, making regular contributions and
building economic security over a lifetime. A 401(k) provides a chance to invest
in the long-term growth of the American economy and an opportunity to build
wealth and independence.
Today's workers own more then $1.5 trillion in assets through their 401(k)s.
Younger workers have an average of about $10,000 in their accounts, while workers
near retirement hold closer to $100,000 in their 401(k)s. This is real money
for real workers and we must do all we can to help make sure it's there for
them when they retire.
Turbulence in the financial markets reminds us that every investment carries
some risk. Yet American workers also have rights which must be respected and
enforced. I've made five common-sense proposals to help protect the retirement
savings of American workers.
First, every worker should get 30 days advance notice before any blackout period
-- the time when they cannot sell, buy or borrow from their 401(k)s.
Second, corporate executives should have to follow the same rules that every
other employee must follow during blackout periods. If you can't sell on the
shop floor, you should not be able to sell on the top floor.
Third, workers should be able to sell their company stock after holding it for
three years so that no one's nest egg is tied up in the stock of a single company.
Fourth, investors should receive better information, including quarterly --
not just yearly -- reports on how their 401(k)s are performing.
And, fifth, workers should have access to professional investment advice so
they can make more informed decisions about their savings.
The United States Congress has passed only two of these proposals -- giving
workers advance notice of blackout periods and holding executives to the same
rules as their employees. I signed these reforms into law.
On Monday my administration is implementing that law with tough new rules to
require that companies give their workers 30 days notice before any blackout
period. Under the new rule, employees will have time to buy or sell stock or
borrow from their accounts before the accounts are temporarily frozen. This
important protection will help ensure that workers don't get stuck in a bad
investment simply because their employers block them from accessing their own
The Securities and Exchange Commission is also working on a new rule to prevent
corporate executives from selling off their own holdings of company stock when
employees are kept from doing so. Corporate executives will no longer be able
to sell off their company's declining stock while employees are left holding
the bag. Both of these rules will take effect early next year and give workers
greater protections against corporate fraud or abuse.
These rules are a step forward in protecting the rights of investors. More steps
are needed. My three additional proposals -- allowing more diversity in 401(k)
accounts, and more frequent account updates, and advice for workers -- have
already passed in the House. But after six months, the Senate has not acted.
For the sake of American workers who are concerned about their retirement security
I urge the Senate to pass the rest of my proposals into law. People who work
hard and save for the future deserve every protection we can give them.