Are Bipartisan Changes Coming To Retirement?
Legislation known as the Setting Every Community Up for Retirement Enhancement Act (or simply, "Secure Act") was passed by the U.S. House of Representatives on May 23. The bill, which seeks to address the looming retirement savings crisis, has the backing of the overwhelming majority of Republicans and Democrats in that chamber.
A CNBC report summarizes the key changes that would be made to existing law:
"[M]aking it easier for small businesses to band together to offer 401(k) plans, requiring businesses to let long-term, part-time workers become eligible for retirement benefits, and repealing the maximum age for making contributions to traditional individual retirement accounts (right now, that’s 70½). It also would raise the age when required minimum distributions, or RMDs, from certain retirement accounts must start to age 72, from 70½, along with making changes to allow more annuities to be offered in 401(k) plans."
Now that it has passed the House, the bill heads to the Senate, where similar bipartisan legislation, the Retirement Security and Savings Act, is also under consideration.
A recent article in Forbes detailed the problems that will be faced by future retirees. Nearly 20% of Americans are reported to have nothing saved for retirement, with large numbers of other Americans possessing an inadequate amount of retirement savings. Causes that have been identified include a lack of employer-provider retirement plans in many workplaces and a vast amount of consumer debt, which now stands at a record $4 billion.