US Capitol Building

Bi-Partisan Congressional Support for Retirement

You may not have noticed but Congress is extremely interested in retirement right now. (No, not their own retirement!) While most headlines are about congressional debates on abortion and other hot issues, there are several bills, some with bi-partisan support, being discussed by the House and Senate. If passed, they would make significant changes for retirement savers and plan sponsors.


Securing a Strong Retirement Act

In March, the House of Representatives passed the Securing a Strong Retirement Act by a whopping 414 to 5 vote. How’s that for bipartisanship! While it still needs to be debated and passed by the Senate, the bill would make several significant changes to retirement plans.

In its current form, the bill requires automatic enrollment in new 401(k), 403(b) and SIMPLE plans. Auto-enrollment is recognized is a valuable tool for improving retirement readiness so this change will make it a required feature of any new plans rather than a plan option.

Other proposed changes in the bill include:

  • Allowing employers to match employee student loan payments with retirement contributions,
  • Expanding the tax credit for small business starting their first retirement plan,
  • Increasing the RMD to age 75, and
  • Indexing the contribution catch-up limits in IRAs.


Increasing Small Business Retirement Choices Act

The Increasing Small Business Retirement Choices Act is another piece of bi-partisan legislation introduced this month in the Senate. The goal of the bill is to reduce retirement plan expenses for small businesses by allowing them to use plan assets to pay for plan related costs such as changing the plan design to implement auto-enrollment and auto-escalation features.

Currently, plan sponsors pay out-of-pocket for the costs related to plan design changes which is seen as cost prohibitive for many small businesses which, in turn, prevents them from enacting design changes that may be in the participants’ best interest.


Employee and Retiree Access to Justice Act

The Employee and Retiree Access to Justice Act was recently introduced in the House by Democrat Representatives Mark DeSaulnier, D-California, and Senator Tina Smith, D-Minnesota. The bill seeks to amend ERISA by eliminating discretionary clauses plan sponsors can include in plan documents. Currently, discretionary clauses can be included which require arbitration, require administrative steps be followed by participants before a lawsuit can be filed, and limit class action suits that can be brought by participants.

The bill sponsors assert discretionary clauses unfairly favor plan sponsors and that participants with legitimate claims should be allowed access to the courts. Multiemployer plans are exempted from the bill. If enacted, the bill would likely result in an increase in fiduciary breach litigation and possibly aid plaintiffs. Bill opponents fear an increase in frivolous lawsuits an that the legislation may make plan sponsors hesitate in offering a retirement plan.


With Congress at loggerheads over many other issues, it is refreshing that there is bi-partisan commitment to improving the retirement readiness of Americans. We are monitoring these bills and will share new information as it becomes available.

Beacon Wealth Consultants is committed to improving retirement readiness through our Kingdom(k)® and Kingdom(b)® plans, 3(38) fiduciary services, and faith-based investing options. Schedule a call to find out more!