The huge omnibus spending bill that was unveiled Tuesday contains an important series of provisions to help Americans save more. Here's the latest from BobPisani:
The huge omnibus spending bill that was unveiled Tuesday contains an important series of provisions to help Americans save more. Buried in the 4,100 page bill is the "Secure 2.0" plan which would, among other things, require employers to automatically enroll employees in their 401 plan at a rate of least 3% but not more than 10% of their salary. Businesses with 10 or fewer employees or in business less than three years would be excluded.
Congress built on that suggestion: the Pension Protection Act of 2006 encouraged employers to adopt automatic enrollment plans. It caught on, and many companies adopted the idea. Enrollment went way up. Today, about 6 in 10 employers offer automatic enrollment. A 2021 Vanguard study found that 91% of new hires stay in the plan when enrollment is automatic, compared with 28% at firms where contributions are voluntary. They also tend to increase contributions over time. The Secure 2.
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