Bipartisan group introduces retirement savings legislation in Senate

A bipartisan group of senators on Tuesday introduced a package of bills designed to make it easier for Americans to save for retirement.

The four senators behind the legislation — Cory Booker (D-N.J.), Tom Cotton (R-Ark.), Heidi Heitkamp (D-N.D.) and Todd Young (R-Ind.) — span the political spectrum, boosting the prospects for advancing the measures.

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“Our work on these bills shows a bipartisan commitment to improving economic security for workers and families, and I hope we can move them forward as they will make a difference for so many Americans who deserve to live with dignity both as workers and retirees,” said Heitkamp.

One measure would pave the way for pooled employer plans, allowing smaller businesses to more easily offer retirement savings schemes for their workers.

Another bill would make more retirement savings automatic, requiring workers to opt out rather than opt in.

About one-third of private sector workers don’t have access to a workplace retirement plan, according to the U.S. Bureau of Labor Statistics, which also found that smaller businesses are significantly less likely to offer defined retirement plans compared to larger companies.

“Americans work hard day after day with often little promise of economic security in the future,” Young said.

The third bill would create “emergency savings accounts” that would serve as alternatives to people accessing their retirement savings early for emergencies, while the fourth measure would allow tax filers to automatically put any tax refunds into a savings account. Those two policies would help Americans who are chronically low on savings.

More than 40 percent of Americans say they would not be able to cover an emergency expense of $400 without borrowing money or selling something, according to a report by the Federal Reserve. Automatically stashing away some cash from every paycheck into an emergency savings fund could help those individuals.

“These commonsense proposals will greatly help people save for their future and retire with dignity,” former Sen. Kent Conrad (D-N.D.), who co-led a Bipartisan Policy Center commission on retirement security and personal savings that helped shape the Senate legislation.