Late Tuesday, the U.S. House of Representatives passed H.R. 2954, the Securing a Strong Retirement Act, by a vote of 441-5. Georgia’s representatives were unanimous on the bill that contains a number of reforms to improve American’s retirement situations.
“In today’s political environment, it’s tough to find areas in which we can work together, but I am proud to be part of this bipartisan effort to ensure Americans can retire with dignity and security,” Congressman Rick Allen (R-GA 12) said. “This bill includes smart reforms to make it easier to save and equip retirees for financial success. Especially in a time of rising prices and high inflation, we must do all we can to ensure that workers are entering into retirement with enough savings to provide for their future.”
U.S. Rep. Rick Allen
Allen was a strong supporter of the bill and spoke on the floor in favor. He was familiar with the legislation as it had passed through the House Education and Labor Committee’s Health, Employment, Labor and Pensions Subcommittee, of which Allen is the lead Republican.
The biggest piece of the bill is the automatic enrollment into 401k and 403b retirement plans, a measure that would go towards one of the bill sponsor’s, Congressman Richard Neal (D-MA 1), noted as a major concern. “Half the people that get up and go to work everyday in America are not in a qualified retirement plan,” Congressman Neal said.
Among many of the other reforms included, the bill would create new tax credits for small business owners to offer retirement plans to their workers. It also raises the age to 75 for required minimum account distributions for Americans that want to wait longer before starting to withdraw funds. Older workers could also contribute more to their retirement savings, going from a maximum of $5,000 to $10,000 per year.
For an increasing number of workers who change jobs more frequently, the bill also creates a national online searchable “Retirement Savings Lost and Found” database at the Department of Labor for workers and retirees to find lost retirement accounts.
Despite the overwhelming support from the House, there are concerns, particularly around the automatic enrollment provision.
“The Chamber supports automatic enrollment but opposes mandating it as Section 101 would because employers that do not include it in their plan design do not do so because of the associated cost, particularly for small employers or those with high turnover,” said Neil Bradley, chief policy officer at the U.S. Chamber of Commerce.
The bill will now head to the senate for consideration and may move relatively quickly after the support from the House, but where the bill still took a year to reach a floor vote. Senators up for reelection may want to add the bill to their list of accomplishments that they take to voters, wishing for their support in November.
