Congress is working to make it easier for American workers to save for retirement, a panel of lawmakers said at the Insured Retirement Institute’s annual virtual convention this week.
Lawmakers want to develop the SECURE law, which was enacted in late 2019. The Securing a Strong Retirement Act 2021 is a follow-up bill to the SECURE Act and is known colloquially as SECURE 2.0. It contains a variety of measures to boost retirement accounts and is strongly supported by the industry.
Sen. Mike Crapo, D-Idaho, a leading member of the Senate Finance Committee, said he focused on three points when it came to enacting retirement savings legislation.
- Congress should adopt policies that encourage workers to save so they can enjoy a secure retirement.
- Congress should make it easier and cheaper for smaller businesses to offer retirement plans.
- Our economy is constantly changing (e.g. people are working longer, more people are working in the odd-job economy), so our retirement system must adapt to this changing landscape.
Senator Ron Wyden, D-Ore., Chairman of the Senate Finance Committee, discussed the pension parity law for student loans and the law encouraging Americans to save.
The Pension Parity for Student Loans Act, introduced in May, would allow 401 (k), 403 (b), SIMPLE and government 457 (b) pension plans to make matching contributions to workers as if their student loan payments were salary reduction contributions. This would reduce student debt and constitute retirement savings. Workers could pay off their debts while saving for retirement.
“Many of the young people who could be the first in their families to go to college are in debt at eye level and should be able to save for their retirement while they pay off that debt,” Wyden said.
Wyden is a sponsor of the Encouraging Americans to Save Act, which was introduced in July. The bill strengthens the incentives to save by restructuring the existing, non-refundable savings credit into a refundable government contribution of up to $ 1,000 per year for middle and moderate income workers who save through savings plans. type 401 (k) or IRA. 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 over a five-year period starting in 2022.
“I think there is a real opportunity for a bipartisan effort on this point,” he said. “I think this is an area where we can get a lot of support. We can get it across the finish line and legislate.
Wyden said Congress must “create solutions to increase the protection of retirement savings and mitigate the risk of outliving them.”
He also called for legislation that would address the portability of retirement benefits in the workplace, noting that “we know workers think it’s no longer their grandfather’s economy where they work at the same. place for 30 or 40 years “.
Susan Rupe is Editor-in-Chief for InsuranceNewsNet. She previously served as Director of Communications for an association of insurance agents and was an award-winning journalist and newspaper editor. Contact her at [email protected]. Follow her on Twitter @INNsusan.
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