Retirement planning officials should prepare next year for the Department of Labor to reissue its conflicts of interest rule — better known as its fiduciary proposal — the official launch of President Barack Obama’s MyRA, more states offering retirement programs for employers as well as pension legislation to encourage annuitization.
While the current Congress has not been the “most robust,” retirement planning issues have been “getting more attention,” as the No. 1 concern among Americans is having enough money in retirement, said Brian Graff, president and CEO of the American Society of Pension Professionals and Actuaries, on Sunday evening at the trade group’s annual conference in National Harbor, Maryland, just outside Washington.
Americans’ worries about outliving their retirement savings are “translating into more policy and political focus on this issue,” Graff said.
More than 17 states have already or are considering passing legislation to provide retirement programs for private employers “in various capacities,” he said.
California and Connecticut, for instance, “have already passed legislation “along these lines,” Graff said, “and Illinois will consider such legislation next month.”
Maryland has a governor’s task force chaired by well-known Democrat Kathleen Kennedy Townsend to look at the issue, while Oregon, Vermont and Washington are also considering private employer retirement legislation.
Graff also said that ASPPA believes Obama will launch next year his MyRA, a new savings bond for moderate-income workers.
Also in the pipeline for rerelease next year is the DOL’s redraft of its rule to amend the definition of fiduciary under the Employee Retirement Income Security Act, said Craig Hoffman, ASPPA’s general counsel and director of regulatory affairs.
“DOL is still committed to the proposed [fiduciary] rulemaking under its current leadership,” Hoffman said. “We expect to see it [the reproposal] sometime next year; [the reproposal] is fraught with political oversight at this time.”
While rumors have been swirling that the regulation will go to the Office of Management and Budget for its 90-day review in November, Hoffman said that “our sources tell us that’s not likely to occur that soon.”
Likely retirement planning “themes” that will surface in the new Congress will include “efforts to reduce leakage” from retirement plans as well as lifetime income and longevity, added Judy Miller, ASPPA’s director of retirement policy.
Sen. Maria Cantwell, D-Wash., is said to be mulling legislation to “incentivize annuitization,” Miller said, “but nothing has been introduced.”
Sen. Ben Cardin, D-Md., meanwhile, “has said that he plans to introduce pension legislation next year,” which would include an “annuitization” component, Miller added.
— Check out Treasury, IRS OK Deferred Income Annuities in 401(k)s on ThinkAdvisor.