Bill Overview
Title: Protecting America’s Retirement Security Act of 2022
Description: of 2022 This bill makes various changes with respect to the administration of employer-sponsored retirement plans, including establishing additional spousal consent requirements for distributions under such plans and requiring the periodic automatic reenrollment of nonparticipating employees in automatic contribution arrangements that take effect after December 31, 2024. The bill also requires the Department of Education, in consultation with relevant agencies, to establish a personal finance education portal that includes information about savings, investing, borrowing, and managing student loan repayment.
Sponsors: Rep. McBath, Lucy [D-GA-6]
Target Audience
Population: People participating in employer-sponsored retirement plans or affected by retirement plan regulations
Estimated Size: 100000000
- Employer-sponsored retirement plans are common globally, given the wide adoption of retirement savings plans by employers in various countries, particularly in developed economies.
- The concept of automatic enrolment and re-enrollment in retirement plans is prevalent in many countries, meaning the provisions of this bill could influence policy consideration outside of the US.
- The effort to require spousal consent is reflective of measures aimed at protecting spouses' financial security, which is a consideration in global retirement planning discussions.
Reasoning
- The policy is primarily targeted at individuals participating in employer-sponsored retirement plans, which is a sizable portion of the population given the high prevalence of such plans in the U.S.
- The Introduced spousal consent requirements and reenrollment provisions will directly affect individuals actively engaged in these retirement plans, while the educational portal could have a broader reach.
- Individuals who are not currently participating in an employer-sponsored retirement plan or are already well-informed about personal finance might not feel a significant impact.
- The policy's budget limits require targeting the sectors where employer participation is highest and where financial education could leverage digital platforms to reach a wider audience.
Simulated Interviews
HR Manager (Texas)
Age: 45 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 20.0 years
Commonness: 18/20
Statement of Opinion:
- The requirement for spousal consent provides an additional layer of security for households. It's a good step.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 9 | 7 |
Software Developer (New York)
Age: 30 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 20.0 years
Commonness: 15/20
Statement of Opinion:
- Automatic reenrollment is helpful. It pushes me to save more, which I might forget.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 9 | 8 |
School Teacher (California)
Age: 50 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 15.0 years
Commonness: 10/20
Statement of Opinion:
- Mandatory spousal consent could be cumbersome, but it's understandable why it's needed.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Freelance Graphic Designer (Illinois)
Age: 28 | Gender: other
Wellbeing Before Policy: 6
Duration of Impact: 0.0 years
Commonness: 7/20
Statement of Opinion:
- I wish there were more resources for freelancers; this policy doesn't really help us.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 6 | 6 |
Small Business Owner (Florida)
Age: 35 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 12/20
Statement of Opinion:
- The educational portal might be useful for planning my retirement, but I need more tailored advice.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 6 | 5 |
Nurse (Washington)
Age: 41 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 13/20
Statement of Opinion:
- The policy would have helped during my divorce, ensuring both parties are informed.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 8 | 6 |
Retail Worker (Georgia)
Age: 29 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 9/20
Statement of Opinion:
- Not directly applicable to me, but the financial education portal could be beneficial.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 6 | 5 |
Public Sector Retiree (Pennsylvania)
Age: 60 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 0.0 years
Commonness: 5/20
Statement of Opinion:
- Spousal consent is a necessary requirement to safeguard family income in retirement.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Construction Worker (Ohio)
Age: 40 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 14/20
Statement of Opinion:
- The emphasis on education will help many workers understand their retirement better, including myself.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 8 | 6 |
Corporate Executive (Michigan)
Age: 52 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 5.0 years
Commonness: 8/20
Statement of Opinion:
- The new requirements seem redundant at my level of understanding and financial management.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Cost Estimates
Year 1: $300000000 (Low: $250000000, High: $350000000)
Year 2: $300000000 (Low: $250000000, High: $350000000)
Year 3: $300000000 (Low: $250000000, High: $350000000)
Year 5: $300000000 (Low: $250000000, High: $350000000)
Year 10: $300000000 (Low: $250000000, High: $350000000)
Year 100: $300000000 (Low: $250000000, High: $350000000)
Key Considerations
- Administrative costs to comply with new spousal consent requirements could be significant for smaller employer-sponsored plans.
- Periodic reenrollment may lead to increased participation but requires substantial administrative coordination and technology adjustments.
- The financial literacy portal's success depends on engagement and utility perceived by users.