House Ways & Means Committee Chairman Richard Neal, D-Mass., introduced Friday new bipartisan legislation, The Setting Every Community up for Retirement Enhancement (SECURE) Act of 2019, which eases the ability to offer annuities in 401(k) and 403(b) plans and raises the age for taking required minimum distributions from 70 1/2 to 72.
The SECURE Act incorporates measures from the previous bill dubbed the Retirement Enhancement and Savings Act, or RESA.
The bill, introduced along with Rep. Ron Kind, D-Wis., Ways & Means Committee ranking member Kevin Brady, R-Texas, and Rep. Mike Kelly, R-Pa., “expands opportunities for Americans to increase their retirement savings and improves the portability of lifetime income options from one plan to another,” lawmakers said.
The new bill includes the core provisions of H.R. 1007, RESA, which the Insured Retirement Institute said it has long supported “plus additional provisions from previously introduced measures.”
The Ways and Means Committee is expected to vote on the new measure next week, likely Tuesday.
With the bill, “we’re taking bold, bipartisan action to address our nation’s retirement crisis,” Neal said. “Providing more, and easier, ways to save allows workers to actively plan for their futures and avoid falling into poverty later in life. Boosting Americans’ financial security in retirement supports families and strengthens our economy.”
Brady added that the bipartisan bill is intended to help American workers “make their own decisions about their finances and retirement. Our reforms will help families save more and earlier for the future, ensuring folks have the flexibility and control over their own savings they need for whatever life throws their way.”
Brady added that the looked forward “to advancing these measures soon.”
In January, Neal, a longtime champion of retirement security, placed retirement income security among his top four legislative priorities for the year.
The committee held a hearing in early February about retirement issues where several policy proposals contained in the new bill were discussed.
“It’s quite clear to me that Chairman Neal says what he means,“ said Wayne Chopus, president and CEO of IRI, in a Friday statement. “Three months ago, Chairman Neal put retirement security on his priority list and since then, we’ve had a hearing, negotiations, a new bill and a scheduled vote to advance it to the House floor. This is major progress.”
IRI says the SECURE Act contains “several common-sense measures” to help Americans by expanding opportunities to save for retirement; increasing access to lifetime income products; helping savers make more informed decisions about their finances for retirement and enhancing features of workplace retirement plans.
The SECURE Act will include, once marked up on Tuesday, provisions to remove restrictions on an employer’s ability to band together in a multiple employer plan (open MEP).
Additional IRI-supported provisions added to the SECURE Act include measures to require employers to allow long-term, part-time workers to participate in their workplace 401(k) plan, and a measure that would increase the current required minimum distribution age limit from 70 ½ to 72 to help workers who face an increased risk of outliving retirement assets because of longer lifespans.
“We look forward to next week’s committee vote to advance this bill to the House floor,” Chopus said. “This is clearly is a major step forward to address our looming retirement crisis.”
— Related on ThinkAdvisor: