Retirement legislation advances with bipartisan support in Congress

Congress has recently advanced several pieces of retirement legislation. We have summarized the latest updates including the status of certain legislative proposals and its key provisions, as well as what you can expect next.

What is the status of SECURE 2.0 and related legislation?

The Securing a Strong Retirement Act, known as SECURE 2.0, passed the House earlier this year with a vote of 414-5. The Senate has been advancing its own versions of SECURE 2.0 with strong bipartisan support.

• On June 14^th, the Senate Health, Education, Labor, and Pensions (HELP) Committee advanced the Retirement Improvement and Savings Enhancements to Supplement Heathy Investments for the Nest Egg Act, known as the RISE & SHINE Act.
• On June 22^nd, the Senate Finance Committee unanimously passed the Enhancing American Retirement Now Act, known as the EARN Act.

Congressional leaders are now expected to reconcile the bills into one retirement package.

What are some notable provisions across the three bills?

There are many areas of overlap across the bills. Importantly, each bill aims to help more Americans save for retirement by expanding access to employer-sponsored retirement plans, increasing individual participation, improving savings outcomes, and advancing a more equitable retirement system. 

Key provisions currently in all three bills include:

• Allowing employer matching contributions based on student loan payments, so workers paying off student debt do not forego important employer-provided benefits.
• Raising catch-up contribution limits for workers nearing retirement age but under 65, enabling these workers to make up for a savings gap.
• Allowing savers to keep their retirement savings invested longer, by increasing the age for required minimum distributions from 72 to 75 over time.
• Increasing access for 403(b) plans by allowing them to participate in multiple employer plans (MEPs).
• Encouraging small businesses to start a retirement plan and adopt auto-re-enrollment, including through enhanced tax credits and extending the start-up credit to employers joining an existing plan, such as a MEP.
• Making it easier for savers to find and receive retirement savings, through the creation of a retirement savings lost and found.

In addition to these important policy priorities, we are hopeful that the final bill will also include measures such as enhancing 401(k) portability and providing access to Collective Investment Trusts for 403(b) plans -- provisions that appear in some, but not all, of the bills.

For a summary of each bill’s provisions, click on the relevant legislation: SECURE Act 2.0, RISE & SHINE Act, EARN Act.

What’s next?

While timing of a unified retirement package is still unknown, we are encouraged by the progress thus far and we are hopeful legislation could pass by the end of the year.

We will continue to monitor the progress of this legislation, as we work across the industry to support measures that help Americans retire with dignity.