Gingrich Urges Interest-Bearing Social Security

House Speaker Newt Gingrich (R-Ga.) proposed Social Security reforms Friday that he said would make American workers millionaires before retirement by paying interest on their pension savings.

Gingrich, who often unveils his policies before Georgia constituents, said after his speech to the Marietta Rotary Club that he had listened to several congressional colleagues in formulating his ideas on Social Security reform and now wants input from the public.

“I favor a national commission on retirement to put all the possibilities out in the open,” he said. “I’d rather have the American people involved in formulating a plan.”

Gingrich stopped short of calling for privatization of Social Security, but he said he would like to see retirement funds go to an interest-bearing account that would grow over a worker’s lifetime.

“A 20-year-old allowed to save the 10.3% FICA [Federal Insurance Contributions Act] tax in an interest-bearing Social Security account--that 20-year-old at 68 would have almost $1 million in his retirement account,” Gingrich said.

“In fact, I predict he or she would have $1.7 million in that account over their lifetime and would be able to leave their descendants half a million dollars when they die.”

Social Security now ceases at death, and an individual’s estate gets only $255 for burial expenses.