Sunday Gazette-Mail from Charleston, West Virginia on June 23, 1974 · Page 108
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June 23, 1974

Sunday Gazette-Mail from Charleston, West Virginia · Page 108

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Location:
Charleston, West Virginia
Issue Date:
Sunday, June 23, 1974
Page:
Page 108
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Page 108 article text (OCR)

unman mn BECAUSE OF VOLUME OF MAIL RECEIVED, PARADE REGRETS IT CANNOT ANSWER QUERIES. ftiWUY The nation' s entire pension system--which covers more than 35 million employees --is about to undergo a "basic overhaul. In the past several weeks, members of a Senate-House conference committee have hammered out a landmark pension reform till which the President is expected to sign into law sometime in July. "This pioneering measure," says Sen. Jacob Javits (R., N.Y.), who introduced the original Senate bill, "will work a · revolution in the lives of working people equaled only by the enactment of the Social Security system in the 1930 f s. For the first time in our history ^retirement will be pos- . sible for a large part of the American working force with reasonable economic comfort." Although all the details have not yet been made public, the new law.will bring reform in the following fundamental areas: ^ · VtStilfl Employees will be guaranteed the right to receive deferred pension benefits on reaching re-· tirement age after working a reasonable length of time--as little as five. years. At present,, about 13 million workers covered under private retirement plans have no vested rights--and-consequently are not entitled to any benefits unless they are still on the company payroll upon retirement. · FHflHHJ! Employers will be required to make sufficient contributions to the plan over the approximate working lives of the ·participants so that promised benefits will be paid. There will be- mandatory participation by private pension plans in an insurance program--similar to Federal Deposit Insurance for banks--which will guarantee payment of legally'obligated pension benefits' if the employer is incapable of discharging his funding- responsibilities. In recent years, a great deal of attention has been focused on cases in which workers have lost their pension benefits when their employer went bankrupt or merged with another company. Judicially enforceable requirements will be established to ensure honest, faithful and competent management of pension and welfare funds and provide employees with access to more adequate information about their plan. r The new law will grant more opportunity for workers to carry their pension'rights from one retirement plan to another. In addition, it. will expand private pension cov-.~" erage. It is estimated' that 25 million workers who file income tax returns are not covered by a PENSION REFORM LEGISLATION SHOULD MAKE MORE OLDER AMERICANS SMILE LIKE THESE SWARE DANCERS IN SUN CITY, ARIZ. retirement 'plan. The. principal, method df "expanding coverage'to these workers --including, many auto mechanics, hairdressers, small businessmen, and supermarket employees--- wj.ll be the adoption of a new individual retirement .savings device,/known as IRA, or Individual Retirement Account. Under IRA, contributions will- be invested in a number of tax- sheltered vehicles, ranging from banks and mutual funds to special "government bonds. These entities will actually hold the contributions; and investment earnings will be free of tax until distributed to. the employee. .. The new law will also mean expanded coverage for self-employed, now limited to"a $2500 retirement fund deduction against annual .income. Under the new system, the maximum will rise to $7500. JACOB JAWTS

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