Magazine

UpFront | Published in May 2017

Bipartisan Support for Lifetime Income Disclosures

By John Manganaro | May 2017
U.S. Senators Johnny Isakson, R-Georgia, and Chris Murphy, D-Connecticut, have introduced a bill they call the Lifetime Income Disclosure Act, which would require 401(k) plan sponsors “to inform participating workers of the projected monthly income they could expect at retirement, based on their current account balance.”
 
The senators say they have garnered significant bipartisan support for the bill, which they believe will help average Americans ensure they do not outlive their savings in retirement.
 
“With the shift to 401(k) plans, American workers have become increasingly responsible for putting savings into and managing their retirement investments,” the senators said in the bill. “However, many Americans are not saving enough, and they are unsure how quickly to draw down their savings in their retirement years.”
 
The thinking behind the legislation is far from new, as other lawmakers have put their names on similar efforts. Beyond Congress, the Department of Labor (DOL) Employee Benefits Security Administration (EBSA) in 2013 shared advanced notice of proposed rulemaking on the subject—followed by a comment period that saw some industry practitioners share concerns that the financial assumptions and calculation tools underlying such disclosures must be customizable enough to give participants an accurate income projection.

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