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News & Press: Advocacy

Pass the Retirement Enhancement and Savings Act (RESA) With Lifetime Income Disclosure

Wednesday, August 22, 2018   (0 Comments)
Posted by: Admin
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What is the Retirement Enhancement and Savings Act (RESA)?

The Retirement Enhancement and Savings Act (RESA) is a package of bipartisan, bicameral retirement bills that will:

    • Provide Lifetime Income Disclosure as described below.
    • Expand Multiple Employer Plans (Open MEPs) allowing small employers to pool together to offer shared retirement plans to their employees.
    • Improve access to lifetime income by enhancing the annuity selection safe harbor for plan sponsors and providing lifetime income portability.
    • Create start up tax credits for small employer retirement plans.


What is the status of RESA?

RESA advanced unanimously out of the Senate Finance Committee in September 2016 and has been introduced in the Senate (S. 2526) by Sens. Hatch (R-UT) and Wyden (D-OR) and in the House (H.R. 5282) by Reps. Kelly (R-PA) and Kind (D-WI).

Why is lifetime income disclosure important?
The lifetime income disclosure provisions included in RESA will help retirement savers understand how their retirement savings could translate into a monthly guaranteed stream of income – just like Social Security - in retirement. 

This lifetime income illustration would be similar to those provided by Social Security and the Thrift Savings Plan (TSP). In the case of the Thrift Savings Plan, the availability of lifetime income illustrations has been found to lead to greater savings[1] (see reverse).

The lifetime income disclosure provisions included in RESA will:

·Enable savers to see the value of their savings as a personal pension plan.
·Make it easier to understand how savings will cover monthly living expenses throughout retirement and address the risk that they could outlive their savings.
·Prompt savers to consider whether they are meeting their savings goals and if necessary, adjust course.

Sample Lifetime Income Illustration


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