WASHINGTON, D.C. — A Senate Committee will explore additional actions that Congress can take to address worker and retiree anxiety about accumulating sufficient savings to provide a sustainable income to last throughout retirement.
The Senate Finance Committee hearing will examine pending bipartisan legislation that builds upon a 2019 law, the Setting Everyone Up for Retirement Enhancement (SECURE) Act. That measure expanded access to workplace retirement plans such as 401(k) plans and Individual Retirement Accounts (IRAs). The new law also improved retirement plan access to lifetime income products, such as annuities, to generate a protected income stream that cannot be outlived.
The Insured Retirement Institute (IRI) welcomed the bipartisan leadership of the Committee’s Chairman Senator Ron Wyden (D-Ore.), Ranking Member Mike Crapo (R-Idaho), and retirement bill sponsors Senators Ben Cardin (D-Md.), Rob Portman (R-Ohio), Maggie Hassan (D-N.H.), Chuck Grassley (R-Iowa), and James Lankford (R-Okla.) in conducting the hearing.
“Workers, retirees, and their families continue to express concern about their ability to accumulate sufficient savings to provide sustainable income to last during their retirement years,” said Wayne Chopus, IRI President and CEO. “This anxiety has significantly grown in the past year with the COVID-19 pandemic’s impact on individuals’ physical and financial health. Today’s hearing sends a clear signal that Congress is determined to deliver effective solutions to strengthen and enhance the retirement security for millions of America’s workers and retirees.”
IRI is a leading advocate for comprehensive retirement security legislation and earlier this year published an expansive “blueprint” of common sense, bipartisan policy solutions. The Blueprint offers measures to expand opportunities to save for retirement, facilitate the use of protected lifetime income solutions to insure against the risk of outliving retirement savings, and augment the tax code to both encourage employees to save for their retirement and employers to offer their employees opportunities to save.
A number of Senate bills have been introduced this year to expand retirement savings opportunities.
One bill, introduced by Senators Cardin and Portman, would boost worker savings in employer-provided retirement plans, improve access to guaranteed lifetime income products, increase the age for required minimum distributions from retirement accounts, and provide additional incentives for small businesses to initiate retirement plans.
Another measure by Senators Hassan, Grassley, and Lankford, would encourage non-profit organizations to offer employee retirement benefits by providing those groups with the same access to pooled employer plans (PEPs) as small businesses. The measure also clarifies when small businesses can use a tax credit to offer retirement plans to their employees if they join a multiple employer plan (MEP) or PEP. This clarification will encourage more small businesses to offer a retirement plan and facilitate greater use of MEPs or PEPs as the means to provide that plan.
A third bill that may be discussed at the hearing is the “Encouraging Americans to Save Act” introduced by Senators Wyden, Michael Bennet (D-Colo.), Bob Casey (D-Pa.), Dick Durbin (D-Ill.), Amy Klobuchar (D-Minn.), Bob Menendez (D-N.J.), and Patty Murray (D-Wash.). The measure would provide an enhanced saver’s credit to help encourage greater savings by middle- and moderate-income workers who save for their retirement through 401(k) type plans or IRAs. The legislation also includes a COVID-19 recovery bonus credit that provides up to $5,000 in additional government matching contributions for the first $10,000 saved during a five-year period beginning in 2022.
“Momentum continues to build in Congress for action,” Chopus said. “Bipartisan, common-sense proposals now before Congress can provide much-needed help for America’s workers, retirees, and their families to build economic equity, strengthen financial security, and protect income in a manner that sustains them throughout their retirement years.”
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Contact: Dan Zielinski
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