Late Friday afternoon, House Majority Leader Rep. Steny Hoyer, D-Md., released the upcoming week’s floor schedule for votes. To the surprise of many, it included H.R. 2954 ‘‘Securing a Strong Retirement Act of 2022.’’
The bill, known informally as SECURE 2.0 and championed by House Ways and Means Committee Chairman Richard E. Neal, D-Mass., and Rep. Kevin Brady, R-Texas, includes several popular and largely bipartisan provisions that supporters say will increase both the number of Americans covered by an employer-sponsored retirement plan, as well as the amount saved.
“Building on the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019, SECURE 2.0 would further improve workers’ long-term financial wellbeing,” according to information released by Ways and Means Committee.
SECURE 2.0’s proposals include:
No. 1: Increasing retirement savings through automatic enrollment, new incentives, and expanded coverage:
- Promotes saving for retirement earlier by expanding automatic enrollment in 401k and 403b retirement plans
- Creates a new financial incentive for small businesses to offer retirement plans
- Increases and modernizes the existing federal tax credit for contributions to a retirement plan or IRA (the Saver’s Credit)
- Allows Americans to save for retirement longer by increasing the required minimum distribution age to 75
- Makes it easier for military spouses to save for retirement by offering small employers a new financial incentive that boosts retirement plan participation by making military spouses eligible for plan participation quicker, increasing eligibility of matching or nonelective contributions, and making military spouses 100% vested in all employer contributions
- Improves coverage for part-time workers in 401(k) plans
No. 2: Encouraging more flexibility for Americans’ retirement options:
- Expands retirement savings options for non-profit employees by allowing groups of non-profits to join together to offer retirement plans to their employees
- Offers individuals 50 and older the ability to set aside greater savings as they approach retirement
- Permits individuals the choice to pay down a student loan instead of contributing to a 401(k) plan, while still promoting increased retirement savings through an employer match in their retirement plan
- Increases charitable donations permitted through an individual’s IRA
No. 3: Protecting Americans’ retirement accounts:
- Safeguards innocent retirees who unknowingly receive retirement plan overpayments
- Creates a national online searchable Retirement Savings Lost & Found Database at the Department of Labor for workers and retirees to find their lost retirement accounts
READ THE FULL BILL HERE