Posted on August 4, 2020

WASHINGTON, D.C. – Negotiations between the Trump Administration and Congressional leaders to craft a new COVID-19 relief package should include help for retirement savers to recover from the economic impact that the COVID-19 pandemic has had on retirement security, according to the Insured Retirement Institute (IRI).

In a letter sent today to the President and Congressional leaders, IRI urged inclusion of its five-point plan to help retirement savers in the anticipated pandemic relief legislation currently under negotiation.

IRI’s five-point plan contains measures derived from bills Congress has seen in some form which either have already been introduced or enacted into law, which will allow workers to keep their tax-deferred retirement savings longer and enhance their ability to save more for retirement now. Joining IRI in its call for action on the plan are the National Association of Insurance and Financial Advisors, the ERISA Industry Committee, the National Association for Fixed Annuities, the National Association of Independent Life Brokerage Agencies and AALU/GAMA. 

“To help prevent America’s retirement security from becoming the next casualty of this terrible pandemic, we respectfully recommend the measures contained within the IRI five-point plan to help retirement savers be included in the COVID-19 relief legislation and enacted into law,” said Wayne Chopus, IRI President and CEO.  “This would serve to ensure that workers and retirees will be able to enhance their ability to save more for retirement now and strengthen their financial security for tomorrow.”

IRI noted recent survey research indicating that retirement savers are struggling due to the economic impacts of the pandemic.

A survey released last week by the Alliance for Lifetime Income found that 70 percent of retirement savers are more pessimistic about their plans because of the pandemic. Fifty-six percent of those not yet retired are rethinking their retirement plans with an estimated 3.2 million people deciding to retire later than originally intended. The survey also found only 33 percent are very confident they will have the income to cover all their expenses in retirement.

IRI further noted in its letter that workers are behind on retirement savings, tapping retirement accounts to replace lost job income, and are contributing less to retirement savings. Each of these factors can result in less accumulation of retirement assets and force workers to work longer and delay retirement.

The key features of IRI’s five-point plan include:

Proposals to Help Americans Keep Money Longer

  • Increase Required Minimum Distribution (RMD) Age to 75
  • Eliminate Barriers to Allow Greater Use of Lifetime Income Products

Proposals to Help Americans Save More

  • Allow Catch-Up Retirement Contributions for those Affected by COVID-19
  • Expand Retirement Saving Opportunities for Non-Profit Organization Employees
  • Clarify Start-Up Tax Credit to Incentivize Small Businesses to Join MEPs/PEPs

“As discussions progress about this next COVID-19 legislation to help our nation’s workers, families and economy recover, the damage done to millions of workers’ and retirees’ retirement security should not be overlooked,” Chopus said. “There is a growing need to do something now on their behalf so they can be put back on a path towards being able to enjoy a secure and dignified retirement.”

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Contact: Dan Zielinski