Congress Passes Sweeping Overhaul of Retirement System - ABI

Congress passed the most significant changes to the nation’s retirement system in more than a decade, a move designed to help Americans save more, the Wall Street Journal reported. With the U.S. population aging and employers shifting responsibility for retirement saving to individuals, lawmakers have grown concerned that a significant portion of Americans are at risk of outliving their money. Americans between the ages of 35 and 64 face a retirement savings shortfall of $3.83 trillion, with 41 percent of households projected to run short of money in later life, according to the nonprofit Employee Benefit Research Institute. One prominent provision of the legislation passed yesterday, which President Trump is expected to sign, encourages 401(k) plans to replicate a feature of old-fashioned pensions by offering products with guaranteed income payments. The legislation also seeks to expand retirement plan coverage by making it easier for small companies to join together to offer 401(k) plans and share administrative costs. An estimated 30 percent of private-sector employees work for employers that don’t currently offer a way to save for the future. ABI

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