Hassan cosponsors bipartisan bill to modernize America’s retirement saving system
WASHINGTON – U.S. Sen. Maggie Hassan cosponsored the bipartisan Retirement Savings Lost and Found Act to return billions of dollars to Americans through a national, online “lost and found” website to track retirement accounts as people move between jobs. The bipartisan, bicameral legislation was re-introduced by Senators Elizabeth Warren (D-MA) and Steve Daines (R-MT) and Representatives Suzanne Bonamici (D-OR) and Jim Banks (R-IN).
“It has become harder for Americans to track their retirement accounts – and this is leading to many Americans losing out on retirement savings that they have worked so hard for,” Senator Hassan said. “I hope my colleagues will join us in advancing this bipartisan legislation, which is more important than ever given that the COVID-19 pandemic has heightened concerns that so many Americans have about whether they will have enough savings for retirement.”
Amid the COVID-19 pandemic, Americans are especially concerned about their retirement savings, with one in five Americans now saying that they plan to retire later than they initially hoped.
As employers have shifted from defined benefit pensions to individualized retirement plans such as 401(k)s, workers have become responsible for tracking, managing, and consolidating retirement accounts as they move from job to job, which is not always easy. The investment management company TIAA estimated that 30 percent of employees–tens of millions of Americans–left a retirement account at their previous employer, including 43 percent of Gen Xers and 35 percent of Gen Yers. And according to the Government Accountability Office, millions more have left two or more accounts behind. Between 2004 and 2013, there was a total of $8.5 billion sitting in lost retirement plans leftover from previous jobs with $5,000 or less in them.
This problem is only expected to grow in the coming years as young workers switch jobs at much higher rates than their older counterparts — the median job tenure for workers between ages 25 and 34 is less than three years. Americans are already an estimated $7.7 trillion short on what they need for their retirement, and some are now relying on their retirement savings to help manage income loss or cover expenses during the current recession.
The bipartisan Retirement Savings Lost and Found Act of 2020:
· Creates a national lost and found website for retirement accounts: It uses data employers are already required to report to the Treasury Department to create a national, online, lost and found website for Americans’ retirement accounts. This means that with the click of a button, any worker can locate all of their former employer-sponsored retirement accounts. No more lost accounts–ever.
· Maximizes investment earnings: The act also makes it easier for plan sponsors to move small accounts into age-appropriate target-date funds so that workers can maximize their investment returns.
· Reinvests small cashed-out accounts: Requires plan sponsors to send lost, uncashed checks of less than $1,000 to Treasury so that individuals can locate this money and continue to save for their retirement.
Senator Hassan is working to help Granite Staters and all Americans save for retirement and recently introduced bipartisan legislation with Senator Susan Collins (R-ME) that would help spouses of active duty service members save for retirement by expanding access to employer-sponsored retirement plans. Senators Hassan and Collins also introduced the bipartisan Retirement Security Act last year to help small businesses offer retirement plans to their employees and encourage individuals to save more for retirement.