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June 2019  Volume 17, Number 6        

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Retirement Reform on Senate and House Agendas

Two similar bills in the U.S. Senate and House are designed to make it easier to save for retirement and both bills appear to have bipartisan support.

The Senate’s Retirement Enhancement and Savings Act (RESA) of 2019 is an updated version of the 2018 RESA legislation, which did not pass. Many senators and observers believe that the 2019 bill is the most comprehensive retirement security measure proposed at the federal level since the Pension Protection Act of 2006. Bipartisan leadership of the Senate Finance Committee introduced the 2019 version earlier this spring.

The U.S. House Ways and Means Committee approved the Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act) this spring. The reform package can now be brought before the full House for a vote. It also was introduced by a bipartisan group of committee members.

Both pieces of legislation have similar provisions, and according to the Insured Retirement Institute, the two bills are "virtually identical". For instance, both bills would encourage employees to increase their retirement savings annually through automatic increases in contributions to their 401(k) plans. It also would require employers to provide estimates of how much an employee’s account would provide during retirement if it were invested in an annuity.

One major difference between the two bills is the time when plan participants would be required to begin taking distributions from their retirement plans. The House bill increases the required minimum distribution age from 70½ to 72, while the Senate bill keeps the age the same at 70½ years.

Highlights of what each bill proposes:

RESA 2019

If passed and signed by the president, the 2019 Senate bill would make a number of changes and modifications to the existing retirement system by:

  • Making it easier for small employers to take part in multiple employer defined contribution plans (MEPs). MEPs are retirement plans sponsored by a group of employers that are not related through common control or ownership. MEPs allow small companies to share and thereby reduce administrative costs, resulting in lower costs and increased investment returns for employees.
  • Removing the age limitation on IRAs for contributions to the plan.
  • Removing some restrictions on automatic enrollment in 401(k)s.
  • Making it easier to use lifetime income options inside a qualified retirement plan.


The House SECURE Act makes it easier for employers to offer annuities in 401(k) and 403(b) retirement plans and, as mentioned earlier, raises the age for taking required minimum distributions from 70½ to 72 years old.

The legislation also includes:

  • Updates to the effective dates.
  • Modifications to the exception to the required minimum distribution rules.
  • Provides for an acceleration of Pension Benefits Guaranty Corporation (PBGC) premiums. The federal government established the PBGC to guarantee basic benefits to participants who are covered by the PBGC in the event that their employer-sponsored defined benefit plans become insolvent.
  • Increases the auto-enrollment safe harbor cap from 10 to 15 percent.
  • Requires employers to allow long-term, part-time employees to participate in workplace 401(k) plans.

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In this issue:

This Just In ... New Association Health Plan Rules Deemed "Absurd"

How to Fight the Opioid Epidemic

To Pay or Not to Pay Parental Leave?

Retirement Reform on Senate and House Agendas

Is Fitness Tracking for Better Health Worth the Risk of Losing Privacy?



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