WASHINGTON, D.C. – Today, U.S. Sens. Sherrod Brown (D-OH) and Jerry Moran (R-KS) announced Senate passage of legislation that incentivizes personal savings through the creation of prized-linked savings (PLS) accounts. Brown and Moran – members of the Senate Economic Mobility Caucus – authored the legislation in Oct. 2013. The bill passed the Senate by unanimous consent.

“Too many families in Ohio – and across the nation – are living paycheck to paycheck,” Brown said. “Between stagnant wages and an insufficient minimum wage, it’s hard for families to prioritize savings. That’s why this legislation is so important. Families should be encouraged and excited to save. This bill accomplishes that and I am proud to have worked with Sen. Moran to get this bill passed.”

“With broad support, Congress has sent to President Obama the American Savings Promotion Act, bipartisan legislation that clears the way for banks and other financial institutions to promote personal savings,” said Sen. Moran, Co-Chair of the Senate Economic Mobility Caucus. “This policy will help American families become more financially secure and upwardly mobile. In passing the American Savings Promotion Act, the House and Senate have shown that good ideas may still have a chance in Washington.”

The American Savings Promotion Act would expand the ability of certain banks, thrifts, and credit unions – which are currently prohibited from participating due to outdated federal law – to offer PLS products. PLS accounts are safe, regulated accounts that incentivize savings by offering account holders the opportunity to win prizes as they accumulate savings.

The legislation comes at a time when more than 40 percent of American households lack enough savings to cover basic expenses for three months. According to the Pew Foundation’s Economic Mobility Project, 71 percent of children born to high-saving but low-income parents move up from the bottom income quintile over one generation. This is compared to only 50 percent of children from similarly low-income households whose parents did not save.

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