H.R.2023 - Women's Retirement Protection Act (119th Congress)
Summary
H.R.2023, the Women's Retirement Protection Act, aims to amend the Employee Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue Code of 1986 to enhance spousal protection under defined contribution plans. The bill addresses the disparity in retirement preparedness between men and women, particularly concerning access to retirement plans, wage gaps, and Social Security benefits. It also introduces grant programs to promote financial literacy for women and assist low-income women and survivors of domestic violence in obtaining qualified domestic relations orders (QDROs).
Expected Effects
The primary effect of this bill would be to increase the financial security of women, particularly in retirement, by ensuring greater spousal protection in defined contribution plans. It mandates spousal consent for certain distributions and beneficiary changes, mirroring protections already in place for traditional defined benefit plans. Additionally, the bill seeks to improve women's financial literacy and access to legal assistance for QDROs, further safeguarding their retirement assets.
Potential Benefits
- Increased Spousal Protection: Requires spousal consent for distributions from defined contribution plans, protecting spouses during divorce or upon the participant's death.
- Improved Financial Literacy: Provides grants for financial literacy programs targeted at women, enhancing their knowledge of retirement planning and personal finance.
- Assistance with QDROs: Offers grants to assist low-income women and survivors of domestic violence in obtaining QDROs, ensuring they receive their entitled retirement benefits.
- Addresses Retirement Disparities: Aims to reduce the retirement preparedness gap between men and women by addressing wage inequalities and caregiving responsibilities.
- Mirrors Thrift Savings Plan Protections: Extends similar spousal protections as those in the Thrift Savings Plan of the Federal Government to other defined contribution plans.
Potential Disadvantages
- Increased Administrative Burden: Implementing spousal consent requirements may increase administrative costs and complexities for plan administrators.
- Potential Delays in Distributions: Requiring spousal consent could potentially delay distributions, even in situations where it is not reasonably possible to obtain consent.
- Limited Scope: The bill primarily focuses on spousal protection and financial literacy, potentially overlooking other factors affecting women's retirement security.
- Funding Dependency: The effectiveness of the grant programs depends on the availability and allocation of appropriated funds.
- One-Size-Fits-All Approach: The bill's blanket requirement for spousal consent may not be suitable for all situations, potentially infringing on individual autonomy in some cases.
Constitutional Alignment
The bill's focus on retirement security and financial well-being aligns with the Constitution's broad goals of promoting the general welfare, as stated in the Preamble. While the Constitution does not explicitly address retirement benefits, Congress has the power to regulate commerce and enact laws necessary and proper for carrying out its enumerated powers (Article I, Section 8). The grant programs authorized by the bill fall under Congress's spending power, which allows it to provide for the general welfare through appropriations.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).