With the recent market downturn, the value of the retirement savings of most Americans has taken a serious hit. Recognizing this, and that 50% of the American workforce has no retirement savings option at work, the Treasury Department announced steps it plans to take to make it easier for those with employer provided retirement plans to participate, and help those without retirement plans at work to save through individual retirement accounts (IRAs). The Treasury announced that it will:
- Expand opportunities for automatic enrollment in 401(k) and other retirement savings plans by streamlining the process for 401(k) plans to adopt automatic enrollment of employees, making it easier to increase the automatic worker contributions to 401(k) plans, and allowing automatic enrollment of workers by employers in SIMPLE-IRAs;
- Make it easier for more than 100 million families to save a portion or all of their tax refunds by giving them the ability to use their refunds to purchase U.S. savings bonds simply by checking a box on their tax return, without having to open an account at Treasury or take any other action, and even if the taxpayer doesn't have a bank account;
- Enable workers to convert their unused vacation or other similar leave into additional retirement savings; and
- Help workers and their employers better understand the available options for tax-favored retirement saving through clear, easy-to-understand language.
The full text of the Treasury's plan for Retirement Security for American Families is available at: http://www.treas.gov/press/releases/reports/090409%20savings%201pg.pdf