A bipartisan bill to create a national online lost-and-found database for retirement accounts has been reintroduced in the Senate.
Sens. Elizabeth Warren, D-Mass., and Steve Daines, R-Mont., reintroduced the Retirement Savings Lost and Found Act of 2021 on May 21, in an effort to reduce the number of missing participants.
The bill, which Ms. Warren and Mr. Daines first introduced in 2016, would use data that employers are already required to report to create the database and would require plan sponsors to send lost, uncashed checks of less than $1,000 to the Office of Retirement Savings Lost and Found — which the bill directs the secretaries of Treasury, Labor and Commerce to create — so that individuals can locate their money.
Also, the bill makes it easier for plan sponsors to move small accounts into age-appropriate target-date funds, according to a news release.
"Millions of Americans lose thousands in savings each year because of lost retirement plans from previous employers and other roadblocks to tracking multiple accounts," Ms. Warren said in the news release. "Our bipartisan Retirement Savings Lost and Found Act of 2021 is a common-sense step we can take now to help hard-working Americans build a little more security and retire with the dignity they deserve."
The lawmakers pointed to a 2017 TIAA-CREF survey that estimated 30% of employees left retirement accounts at their previous employers, including 43% of Generation X and 35% of millennials. Also, from 2004 to 2013, there was $8.5 billion sitting in lost retirement plans with balances of $5,000 or less, according to a 2014 Government Accountability Office report noted in the news release.
Groups like the Pension Rights Center, American Benefits Council and ERISA Industry Committee have endorsed the bill.
"Currently, thousands of individuals contact pension counseling projects and government agencies each year seeking help in finding their lost pensions," Karen Ferguson, president of the Pension Rights Center said in the news release. "This important bill will close a critical and too-long-overlooked gap in our nation's private retirement system."
Major bipartisan retirement security packages introduced this month House and Senate include provisions that would establish national online lost-and-found database for retirement accounts.
