Most 401(k) and 403(b) plans would automatically enroll participants, with the initial automatic enrollment amount being at least 3%, if the Secure 2.0 package is passed this week.
Workers will be able to save more easily for retirement with a proposed move that would automatically enroll them in 401 plans and other retirement savings plans.
“Auto enrollment gets them started right off the bat,” said David Certner, AARP’s legislative policy counsel. “Since there’s an opt-out feature, that solves any problems with people not wanting to be involved.” “Study after study shows that automatic enrollment increases participation and keeps that participation at that level. It’s much harder to opt out than to just keep saving money that’s out of site, out of mind,” said Ryan Brown, partner and attorney at financial planning firm CR Myers & Associates, a wealth management firm. “Retirement is always a ‘I’ll start next year’ problem or ‘I’ll start when I’m married and making more money’ and it never happens.
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