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An Open Letter of Support: Automatic IRA Act of 2024

Head of US Defined Contribution

February 7, 2024

The Honorable Richard Neal
372 Cannon House Office Building Washington, DC 20515-0916

Dear Representative Neal:

On behalf of State Street Global Advisors (“SSGA”), I am writing to express our strong support for the Automatic IRA Act of 2024, which you will be introducing soon.

One of the greatest retirement security challenges our country faces is the fact that more than a third of all US employees and half of all small business employees do not have access to a workplace retirement savings plan. While we applaud you for enacting both SECURE and SECURE 2.0 in the past five years, those tax incentives, coupled with the alphabet soup of different plan designs, have not moved the coverage needle as much as we had all hoped. It is time to take bold action, which is what your legislation does. We applaud you for your leadership in tackling what we believe is one of the most critical, and personal, issues facing American workers today.

Although we believe that tax incentives and other mechanisms play an important role in spurring retirement plan coverage, the time has come for ensuring that all employers provide access to retirement plans for their employees. Important steps to help facilitate coverage through provisions included in SECURE 2.0, including auto enrollment and auto escalation, and providing tax credits to small employers to cover the administrative costs of establishing and maintaining those plans. Taken together with open multiple employer plans (MEPs), we believe these proposals will make a significant difference in ensuring that working Americans are able to retire with dignity and do so without placing unnecessary administrative or financial burdens on employers.

At SSGA, we are committed to advancing public policy that broadens retirement coverage and helps Americans achieve the secure retirement they deserve. In our view, the combination of requirements and incentives, together with the elimination of regulatory obstacles to the creation of open MEPS that were included in SECURE and which are now proliferating, will go far in achieving that goal.

As 10,000 American workers are expected to retire every day over the next 10 years, Congress can no longer postpone agreeing on a pragmatic, bipartisan solution to a problem that has direct implications for the dignity of our citizens and the future of our country’s economy and social fabric. The cost of inaction is great: for individuals, employers, and state and federal government programs.

Every day we fail to act is another day that Americans fail to save for the future and the problem deepens.

We applaud your leadership in introducing this important legislation and look forward to helping move it to enactment.

Brendan Curran

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