Hundreds of retirement industry leaders gathered for a black-tie affair in Washington D.C. Thursday night to celebrate 50 years of the Employee Retirement Income Security Act and talk about the legacy, evolution and future of the landmark legislation.
“Tonight, as we reflect on the past 50 years, we also look ahead to the future. The next 50 years of ERISA will undoubtedly bring new challenges—whether it’s addressing the evolving nature of work, responding to economic uncertainties, or meeting the needs of a more diverse and dynamic workforce,” said gala speaker Susan Neely, President and CEO of the American Council of Life Insurers. “But we stand together, committed to protecting the dignity and security of every worker’s retirement. That commitment will continue to guide us as we write the next chapter of ERISA’s history.”
Senator Ron Wyden (D-OR), Chairman of the Senate Finance Committee and a longtime advocate for retirement reform legislation, was the Guest of Honor and Douglas Brinkley, U.S. Presidential Historian and New York Times best-selling author, was the guest speaker. American Retirement Association CEO Brian Graff and Investment Company Institute CEO Eric Pan also spoke at the gala in addition to ACLI’s Neely.
The evening event at the National Building Museum followed an ERISA 50 symposium during the day, where five different panel discussions covered topics including the history behind ERISA, recent political, societal and policy changes impacting ERISA, navigating technological, economic, and workforce changes, and how ERISA’s evolution can support a changing workforce.
ERISA 50th Research Project debuts
T. Rowe Price also presented its ERISA 50th Research Project during Thursday’s symposium, a new white paper exploring how defined contribution (DC) plans have improved the retirement savings landscape in America in the ERISA era and ways that DC plans can continue to support the evolving and diverse needs of retirement savers.
“It was an incredible honor to speak at the ERISA symposium among fellow retirement leaders,” said Sudipto Banerjee, director of retirement thought leadership at T. Rowe Price, author of the white paper. “Reflecting on the strong foundation ERISA has laid for retirement savings and discussing how we can build on its success was both inspiring and vital. Together, we can guide even more savers toward better retirement outcomes.”
Key insights from the white paper, “The Success of Defined Contribution Plans and the Road Ahead,” include:
• According to the Investment Company Institute, today, defined contribution plans across the private sector, government agencies, and non-profits, along with IRAs, account for 63% of the $40 trillion in U.S. retirement market assets.
• Defined contribution plans have expanded retirement plan access and participation, increased savings rates, and provided diversified investments for U.S. workers.
• Wider adoption of auto-features, such as automatic enrollment, reenrollment, and auto escalation, could significantly enhance participation and outcomes. According to T. Rowe Price data, retirement plans with auto-enrollment have an 83% participation rate compared to 36% for plans without it.
• According to data from the Survey of Consumer Finances, more than three-quarters of total liquid financial assets of middle-income families are invested in retirement accounts • American workers can meaningfully replace their income in retirement through the combination of employer-sponsored retirement savings plans and Social Security.
• Protecting Social Security, delivering retirement income solutions, and addressing savings barriers for workers could also improve the retirement system.
“By focusing on adoption of effective auto-features, addressing racial and gender savings disparities, and delivering personalized solutions for workers, we can continue to improve retirement coverage and outcomes for all Americans.”
Michael Davis, T. Rowe Price
“Defined contribution plans have become the vital force behind a secure retirement for most U.S. workers, and while ERISA has laid a strong foundation for retirement savings in America, the work is not yet done,” said Michael Davis, head of global retirement strategy at T. Rowe Price. “By focusing on adoption of effective auto-features, addressing racial and gender savings disparities, and delivering personalized solutions for workers, we can continue to improve retirement coverage and outcomes for all Americans.”
ERISA 50th host organizations include AARP; American Benefits Council; American Council of Life Insurers; AHIP; American Retirement Association; Blue Cross Blue Shield Association; Defined Contribution Institutional Investment Association; The ERISA Industry Committee; Investment Company Institute; The SPARK Institute; and the U.S. Chamber of Commerce.
SEE ALSO:
• Retirement Industry Gathers to Celebrate ERISA at 50