U.S. Labor Department Makes It Easier for States to Launch Retirement Plans
Millions of workers struggle to save for retirement in part because it isn’t easy enough to open an account or to have the money automatically deducted from their paychecks. But they could soon find themselves with more options. Last week, the Labor Department unveiled a rule that should make it easier for states to launch their own retirement plans for private-sector workers who don’t already have access to savings accounts through their jobs. The rules, which were requested last year by President Obama, provide a clearer road map for states who want to provide such plans but needed more federal guidance. The department also announced a proposed rule that would open the door for large cities to create their own plans. With the new guidance, states that create their own plans will be able to automatically enroll workers into individual retirement accounts (IRAs). Workers will also be able to have their contributions automatically deducted from their paychecks, an option that is not usually available for people saving for retirement outside of a workplace plan. Employees typically gain access to these easy saving strategies when they have retirement plans at work, such as a 401(k) plan.
Source/more: Washington Post
David Wingate is an elder law attorney at the Elder Law Office of David Wingate, LLC. The elder law office services clients with powers of attorneys, living wills, Wills, Trusts, Medicaid and asset protection. The Elder Law office has locations in Frederick and Montgomery Counties, Maryland.