**GAO-03-309**                      Published: Mar 10, 2003. Publicly Released: Apr 09, 2003.                  

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## Highlights

Many proposals have been offered to restructure the U.S. Social Security system to include individual retirement savings accounts. However, some key proposals would make participation in the accounts voluntary rather than mandatory. While any individual account plan can offer a variety of choices regarding contributions, investments, and withdrawals, the choice of whether or not to participate is fundamental to a voluntary approach. That choice could have significant effects on individual retirement incomes and on the costs to the government as well. GAO was asked to report on the implications of using a voluntary approach to individual accounts. Accordingly, GAO's reporting on (1) how voluntary plans can affect individuals, (2) how they could affect the total costs of the retirement system, and (3) the role of educational efforts relating to the participation decision. Throughout this report, GAO focuses on the issues that pertain specifically to a voluntary approach as distinct from a mandatory approach. GAO studied three countries that  have enacted voluntary individual account plans--the Czech Republic, Germany, and the United Kingdom.

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## Topics

Retirement Security

Federal social security programsRetirement benefitsRetirement incomePensionsParticipation ratesPension planAccountsSocial security systemAdministrative costsAdverse selection