A bill focused on improving retirement plan fee transparency and plan disclosure requirements has been introduced as a stand-alone bill in the Senate.
Sen. Ben Ray Luján, D-N.M., a member of the Senate Health, Education, Labor and Pensions Committee, introduced the Savvy Savers Act on Wednesday.
The bill is part of the HELP Committee's bipartisan Retirement Improvement and Savings Enhancement to Supplement Healthy Investments for the Nest Egg Act, or RISE & SHINE Act, that was introduced Tuesday and will be marked up in committee June 14.
Mr. Luján's bill, like the RISE & SHINE Act, would direct the Department of Labor to study its retirement plan disclosure requirements and recommend ways to "enhance participants' understanding of fees and expenses." The bill directs the Labor Department to file a report with the HELP Committee and the House Education and Labor Committee within three years of the bill's passage.
The Government Accountability Office in August 2021 released a report that found that almost 40% of 401(k) plan participants do not fully understand the fees they are paying.
"Retirement plan disclosures are important tools for retirees and employees to understand the fees they pay, how they are managed, and any conflicts of interest," Mr. Luján said in a news release. "But many employees saving for retirement do not understand these disclosures through no fault of their own. This legislation would demystify the retirement process for working Americans, who are bogged down by bulky paperwork full of legalese. My bill would ensure the DOL and Congress collaborate to work toward clear and simple disclosures in retirement planning for all workers."
Moreover, Mr. Luján's bill, again like the RISE & SHINE Act, would require the Labor Department, the Treasury Department and the Pension Benefit Guaranty Corp. to review reporting and disclosure requirements for retirement plans and make recommendations to Congress to consolidate, simplify, standardize and improve such requirements.
The RISE & SHINE Act will likely serve as a piece of the Senate's SECURE 2.0 package. The House passed its SECURE 2.0 bill in March in 414-5 vote. The bipartisan package expands on the Setting Every Community Up for Retirement Enhancement Act, known as the SECURE Act, which Congress passed and was signed into law in late 2019.