WASHINGTON – Today, U.S. Senators Bill Cassidy, M.D. (R-LA), chair of the Senate Health, Education, Labor and Pensions (HELP) Committee, and Tim Kaine (D-VA) introduced the Auto Reenroll Act to help American workers take advantage of their available employer-sponsored retirement plans and full employer match offers by permitting more frequent opportunities for employees to opt in.
“Americans should have every opportunity to invest for a secure retirement,” said Dr. Cassidy. “Auto-reenrollment enables workers to be in better control of their finances so they can be ready for retirement.”
“For many Americans, employer-sponsored retirement plans become a crucial part of their long-term financial security,” said Senator Kaine. “That’s why it’s important that we make it easier for more workers to take full advantage of these opportunities. I’m glad to team up with Senator Cassidy to introduce our bipartisan bill to help make that happen so more Americans can get enrolled and improve their financial footing.”
Currently, one in four American workers are not enrolled in their employer-sponsored retirement plans, and one-third are not taking advantage of their full employer matching contribution. Proactively encouraging these workers to enroll is critical because many choose not to participate in these programs when they are first hired or making entry level wages but then may never be promoted to reconsider that decision or increase their contribution as their income increases. That can lead to significant confusion—59 percent of workers who are not participating in their workplace plans thought they were participating when surveyed.
Specifically, the Auto Reenroll Act would address this issue by amending safe harbors in the Employee Retirement Income Security (ERISA) and Internal Revenue Code to permit plan sponsors to reenroll non-participants at least once every three years, unless the individual affirmatively opts out again.
The legislation is endorsed by AARP, the American Benefits Council, American Retirement Association, Edward Jones, Empower, LPL Financial, Nationwide Retirement Solutions, and Transamerica.
Read the full bill text here.
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