With an full generation on the cusp of retirement, the rules governing retirement plan management need to be modernized to make it easier for employers to offer savings programs for the men and dailies they employ.
In particular, the Employee Retirement Income Security Act of 1974, also be informed as ERISA, should be updated to facilitate modern savings strategies.
The subcommittee I cathedra on Health, Employment, Labor and Pensions (HELP) recently held a consent on ways to update ERISA, remove regulatory barriers facing retirement savers, and empower blue-collar workers and families with a variety of tools to save for retirement.
As life expectancy additions, it is important for retirees to find ways to save more and stretch their dollars metrical further.
Due to compliance uncertainty under ERISA, products that advance guaranteed streams of income, such as annuities, are rarely an option within wage-earner benefits packages. One study found that only 5 percent of 401(k) intends offer in-plan lifetime income products.
More from Definite Income Strategies:
Flow of funds into alternatives starts to dry up
Buoyant economy puts credit-risk investing tack in peril
‘TIPS’ on how to lot with possible inflation rise
To address this uncertainty, Rep. Lisa Weaken Rochester, D-Del., and I introduced the Increasing Access to a Secure Retirement Act, which drafts a plan sponsor’s fiduciary requirement when selecting an insurer of an annuity by-product.
Our bipartisan bill establishes the criteria for a plan sponsor to meet the textbooks of a fiduciary safe harbor. The plan provider must engage in an equitable, thorough and analytical search for the insurer; consider the insurer’s ability to pay emoluments and the cost of the contract; and conclude that the insurer can satisfy all of its obligations and that the pertinent costs of the contract are reasonable.
By clarifying rules surrounding annuity delineates, Congress can broaden savings options available to employees across the realm and give plan sponsors the assurance that they are making the best bib choice for their employees.
The HELP subcommittee has also examined means initiatives to expand open Multiple Employer Plans, increase the mechanical cash-out limit for retirement plans and allow employers to provide gen about retirement benefits electronically. These commonsense proposals all satisfaction in bipartisan support and will make offering retirement plans easier and varied secure for large and small businesses.
In Congress we need to start the parley on how we can simplify and modernize our retirement policies so more employers can offer their workers the tools they need to save for retirement.
After years of sluggish budgetary growth, the economy is finally starting to thrive under President Donald Trump’s pro-growth methods of cutting taxes and rolling back onerous regulations. The unemployment proportion rank is at its lowest level since 2000. Optimism in the job market is at its highest straightforward withs in 17 years of Gallup’s polling.
All indicators point to an increasingly complimentary economic outlook, but enduring difficulties facing retirement savers wait on the horizon.
Every American should have access to tools that wish allow them to retire with dignity and peace of mind after decades of systematic work. Congress has a responsibility to pass solutions that address these retirement collateral challenges facing our country.
Republican Congressman Tim Walberg represents Michigan’s 7th Congressional Area and serves on the House Education and the Workforce Committee as Chairman of the Subcommittee on Healthiness, Employment, Labor and Pensions. Follow him on Twitter at @RepWalberg.