“Expand opportunities to save for retirement by enhancing access to, and features of, workplace retirement plans” is the very first goal listed by the Insured Retirement Institute in its 2020 federal legislative policy objectives, released in late February.
Hey, that’s a goal 401k-focused advisors and the “leading trade association for the retirement income industry,” as IRI calls itself, can certainly agree on.
IRI annually releases its “blueprint” for its federal and state policy objectives for the year, and this year they remain focused on expanding workers’ opportunities to save for retirement, facilitating use of lifetime income products and supporting consumer protections that safeguard against financial exploitation and maintain consumers’ choice of financial advice and products.
“Our federal and state blueprints provide a clear, concise public policy agenda that we will seek to advance through constructive engagement,” said Wayne Chopus, IRI president and CEO. “This successful approach helped to enact comprehensive retirement security legislation last year and shaped federal and state standard of conduct regulations.”
In addition to the aforementioned “expanding opportunities to save for retirement…” goal, other goals include:
- Facilitate and encourage greater access to and use of lifetime income products in workplace retirement plans
- Preserve and promote access for retirement savers to professional financial guidance, education and information
- Enhance protections to safeguard Americans from financial exploitation and fraud
- Maintain and augment the current tax treatment of retirement savings
Following last year’s enactment of the SECURE Act, IRI says it will focus its efforts on advancing additional legislation to help American workers save for retirement and facilitate the utilization of lifetime income products.
IRI Federal Blueprint Legislative Highlights
Here are highlights of IRI legislative goals relating to retirement plans:
- Require all but the smallest employers to maintain a retirement savings plan in which employees would be automatically enrolled (with the ability to opt out).
- Update the required minimum distribution (RMD) rules to reflect longer lifespans and modernize the RMD minimum income threshold test to benefit more older individuals seeking to use lifetime income options during their retirement years.
- Increase catch-up contribution limits for Boomers and allow catch-up contributions for caregivers and members of the U.S. armed forces ready reserves.
- Establish electronic delivery as the default method for providing required disclosures to plan participants, while preserving the option to receive paper upon request.
- Allow employers to make voluntarily matching contributions to help employees save for retirement while making student loan payments.
- Extend retirement savings counseling to federal student loan, job training and apprenticeship program recipients.
IRI Federal Blueprint Regulatory Highlights
- Regulation Best Interest Implementation: Policymakers in Washington and across the nation should align their standards of conduct with the Securities and Exchange Commission’s (SEC) Regulation Best Interest (Reg BI) to ensure all Americans are protected by a clear, consistent and workable best interest standard that will provide meaningful and effective consumer protections without depriving them of access to valuable financial products and services.
- Summary Prospectus for Variable Annuity Products: Following a multi-year effort led by IRI, the SEC should finalize its proposal to create a more useful, consumer-friendly disclosure of essential information about variable annuity and variable life insurance contracts.
- Reduce Regulatory Barriers to the Development and Offering of Innovative Products: The SEC should adapt its rules relating to the registration of annuity products to facilitate and encourage the insured retirement industry’s ability to develop and provide new and innovative products for investors, like Registered Index Linked Annuities (RILAs), and to ensure investors can easily find the information they need about these products.
IRI State Blueprint Highlights
When it comes to individual states, IRI is calling on state policymakers to pursue uniform adoption of the revised NAIC best interest model regulation, saying individual state efforts to impose a fiduciary duty on broker-dealers would result in a patchwork of conflicting and inconsistent regulations that would impair consumer access to financial advice and products.
IRI is also advocating for states to refrain from establishing state-run plans, and instead encourage their federal counterparts to pass legislation making it easier for small- and mid-size employers to offer retirement plans.
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.
