A new Congressional proposal, the Saving for the Future Act, would require employers to make direct contributions to workers’ retirement savings. Companies with 10 or more employees must contribute at least 50 cents per hour worked, increasing to 60 cents after two years. Workers at smaller companies would save through federal universal personal accounts.
The bill also includes automatic contributions to an UP-Savings account for emergency expenses, allowing workers to accumulate $750,000 by retirement with the default 4% contribution. Democratic Reps. Scott Peters and Norma Torres introduced the bill, backed by Third Way projections.
Despite prior endorsements from advocacy groups like AARP and the National Urban League, the bill previously died in committee. With retirement prospects declining, legislators stress the act’s importance. The bill has been referred to the House Ways and Means Committee and the House Education and Workforce Committee.
While the bill faces challenges in a Republican-majority House and Senate, advisors like Gabriel Shahin are optimistic. Shahin believes recent legislation focusing on strengthening employee benefits is a positive step, promoting long-term stability and reducing dependence on government programs.
The shift to 401(k)s for retirement savings has left many workers without adequate savings, prompting the Saving for the Future Act. Financial advisors stress the need for additional support and education to ensure Americans can save effectively for retirement.
While some may view the bill as government overreach, others see it as a necessary step to help Americans build better savings habits. With many workers unable to save consistently on their own, the bill aims to provide support and security for a more prosperous future. 1. The stock market saw a significant drop today, with the Dow Jones Industrial Average falling by over 500 points. Investors are concerned about rising inflation and interest rates impacting the overall economy.
2. A new study has found that the COVID-19 vaccine effectiveness may decrease over time, especially against the Delta variant. Health officials are urging individuals to get booster shots to maintain immunity.
3. The United Nations Climate Change Conference (COP26) is underway in Glasgow, Scotland, with world leaders coming together to discuss ways to combat climate change. Discussions are focusing on reducing carbon emissions and transitioning to renewable energy sources.
Read more at Yahoo Finance: Congress renews effort to require 401(k) contributions by employers