House committee to consider ‘Secure 2.0’ pension bill this week – fr

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House committee to consider ‘Secure 2.0’ pension bill this week – fr


Richard Neal, Chairman of the House Ways and Means Committee.
Matt Stone | Boston Herald | Getty Images
The House Ways and Means Committee is set to consider a bill on Wednesday that would change the way working Americans save for their retirement.
The measure, known as the Securing a Strong Retirement Act of 2021, comes less than a year and a half after another major retirement savings bill, the Secure Act of 2019, was enacted by then-President Donald Trump. Like this legislation, this new bill enjoys bipartisan support: Its sponsors are Ways and Means Committee Chairman Richard Neal, D-Mass., And Line Member Kevin Brady, R-Texas.

“Retirement issues have a bipartisan legacy that continues with the Neal-Brady legislation,” said Wayne Chopus, president and CEO of the Insured Retirement Institute. “We are confident that Congress will act quickly to help more people build economic equity and strengthen the financial security to support them through their retirement years. “

Here’s a look at the retirement news.

Among the provisions included in the new bill, which is similar to a version launched last year by Neal and Brady, is gradually increasing the age at which individuals must begin receiving the minimum required distributions from their retirement accounts to 75 years from age 72 (the Secure Act changed to 72 from 70½) and requiring most companies that open a new 401 (k) plan (or similar work option) to automatically enroll their employees.

“We’ve learned over time… that auto-enrollees are much more likely to stay in the plan,” said Melissa Kahn, executive director of retirement policy at State Street.

The bill would also index to inflation the “catch-up” contributions that people aged 50 and over can make to their retirement accounts (an additional $ 6,500 for 401[k] plans and $ 1,000 for IRAs). And that would increase those catch-up amounts for people aged 62 to 64, and allow workers to receive matching 401 (k) contributions (from employers) when they pay off their student loan debt instead of contribute to their retirement savings account.

In addition, certain restrictions on eligible longevity annuity contracts would be lifted. Currently, the maximum that can be paid into a CAQQ is $ 135,000 or 25% of the value of your retirement accounts, whichever is less. The bill would remove the 25% cap.

“You’re kind of limited today in terms of how much you can invest in a QLAC,” Kahn said, adding that removing the cap would allow people with high account balances to achieve this. limit of $ 135,000.

The new measure is expected to be voted on at the committee’s markup session on Wednesday, when amendments could be introduced and adopted or removed. If the bill is referred to committee, it will then be put to a vote in the plenary chamber, although the timing is uncertain.

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