House and Senate working on bills to make it easier for small businesses to offer retirement plans

Ted Knutson writes at Financial Advisors that the House and Senate are working on bills to make it easier for small businesses to offer 401(k) plans. He writes:

Bills making it easier for small businesses to offer 401(k)s by cutting costs and red tape are advancing in the Senate and the House this week. The Senate Finance Committee passed the Retirement Savings and Enhancement Act on Wednesday, while the House Education and the Workforce Committee is scheduled to take the first step to pass similar legislation Thursday.

Finance Committee member Sen. Sherrod Brown, D-Ohio, said the Senate bill has the potential to dramatically increase the number of workers with payroll retirement savings plans by easing the way for small employers to join together to take advantage of economies of scale in workplace 401(k)s—the so-called open multiple-employer plans (Open MEPs). Making it easier for small employers to offer retirement savings is important because only 20 percent of workers at companies with under 500 employees are in job-based retirement plans, while the number is four times greater for businesses with over 500 workers, noted Virginia Democrat Sen. Mark Warner, D-Va., who serves with Brown on the Senate finance and banking committees.

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