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Legislation

Saving for the Future Act introduced in House

A group of Democratic legislators introduced the Saving for the Future Act in the House.

A group of Democratic legislators introduced the Saving for the Future Act in the House.

The bill, introduced Monday by Reps. Lisa Blunt Rochester, D-Del.; Scott Peters , D-Calif.; and Lucy McBath, D-Ga., would establish a minimum employer contribution to a worker's savings plan, with the goal of helping Americans better save for retirement and emergencies. It was introduced in the Senate last week by Sens. Amy Klobuchar, D-Minn., and Christopher Coons, D-Del.

The bill would apply to companies with 10 or more employees and require employers to contribute 50 cents per employee hour worked. The minimum would rise to 60 cents after two years and then rise with wage growth, according to a summary of the bill.

The employer contributions would be directed to a given retirement account, such as a 401(k), but if a retirement plan isn't offered, the contributions would go into a universal personal, or UP, account.

Most companies that offer a pension plan or 401(k) match would already be in compliance.

Businesses would receive tax credits for their contributions, which would be offset by increasing the corporate tax rate to 23% from 21% and raising the tax rate on the nation's wealthiest households to 39.6% from 37%.

"For the 1 in 3 Americans who have no retirement plan or pension, the Saving for the Future Act provides a path to long-term financial security," Ms. McBath said in a news release. "This legislation creates an opportunity for hardworking Americans to build wealth and to protect their families from inevitable unexpected emergency costs."