A bill reintroduced by Senators Jeff Bingham (D-NM), Johnny Isakson (R-GA), and Herb Kohl (D-WI), would require defined contribution plans subject to ERISA to provide participants with an annual projection as to how their account balance would translate into a monthly income stream at retirement.
The aim is to bring the same kind of annual benefit estimates provided by the Social Security Administration to workers for the last 20 years to 401(k)s and other private savings plans subject to ERISA.
To minimize the administrative burden to employers, the legislation directs the Department of Labor to issue tables employers may use for retirement income calculations, as well as a model disclosure that, if used along with with prescribed assumptions and DOL rules, would insulate employers from liability.
Support for the bill was voiced by the American Counsel of Life Insurers, the AARP, the American Society of Pension Professionals & Actuaries, the Heritage Foundation, the U.S. Women’s Chamber of Commerce, and the Women’s Institute for a Secure Retirement.
The Senators’ complete news release can be found at Insurance News Net.