As the House prepared the vote on H.R. 2954 ‘‘Securing a Strong Retirement Act of 2022,’’ also known as SECURE 2.0 on Tuesday, the Senate Committee on Health, Education, Labor and Pensions (HELP) held a full hearing called “Rise and Shine: Improving Retirement and Enhancing Savings.”
Led by Senator Patty Murray, D-Wash., the committee’s Chair, it focused on enhancing emergency savings and strengthening retirement security.
Murray noted how the COVID-19 pandemic highlighted the urgency of making sure Americans have the tools and information they need to be able to save for emergencies and prepare for retirement.
She added that while financial experts say families with low incomes should have six weeks of emergency savings, reports from before the pandemic found almost two-in-five Americans would struggle to come up with $400 in an emergency.
“I’ve heard from families in Washington state who were forced to raid savings meant for their futures, just to make ends meet—savings for their kid’s college fund, a down payment on a house, or for their retirement,” Murray said. “And that’s not even the half of it. Many people across the country have never even had access to a retirement plan, and never even been paid enough to make ends meet—let alone save for the future. COVID-19 was exactly the kind of crisis millions of families simply could not afford.”
More bipartisan legislation
In her opening statement, Murray noted she and Senator Richard Burr R-N.C., are currently working on bipartisan retirement legislation they are aiming to put forward later this spring and laid out some of the issues she hopes to address in their package.
The bipartisan bill in the works would build on the House’s “Retirement Improvement and Savings Enhancement (RISE) Act” with additional proposals focused on improving people’s financial security like providing new emergency savings options, auto re-enrollment, helping people find ‘lost’ retirement accounts, improved transparency around lump-sum offers and fee disclosures, and more.
Murray also raised the importance of ensuring people have clear, complete information regarding hugely consequential financial decisions. A GAO report she requested found that fee disclosures for 401k plans are not effective at helping people understand key information.
Another GAO report found that disclosures related to lump-sum offers, where people trade a lifelong pension for a one-time payout, often lack key information—an issue Senator Murray has introduced legislation in the past to address.