Stress-Free Financial Certainty

Dec 11, 2023

Wouldn’t it be great if planning for retirement were stress free? Unfortunately, the high cost of living and the unpredictability of the stock market cause many Americans to worry about their financial future.  

When measuring retirement security – or retirement income adequacy – data shows over 40% of U.S. households are at risk of running short of savings in retirement, increasing the likelihood of not having enough resources for a desirable standard of living.

Almost half of private sector workers don’t have access to an employer-sponsored retirement plan, representing 55 million Americans. Only 34% of Baby Boomers and 26% of Gen Xers feel like they’re on the right track with their retirement savings, according to a recent Bankrate survey

The life insurance industry recognizes the challenges that Americans face when preparing for retirement. ACLI and its member companies, including TIAA, led the successful drive for Congress to pass the bipartisan SECURE and SECURE 2.0 bills in 2019 and 2022. These laws closed savings gaps and expanded access to retirement security, with key provisions to help ease access to annuities.

Still, with so many Americans worried about their retirement security, it’s clear that more needs to be done. TIAA issued a call for action in its Retirement Bill of Rights, which notes that every worker in America has the right to save for and achieve a financially secure retirement. The public and private sectors share responsibility for helping every worker access retirement income that will last the rest of their lives. 

To that end, life insurers and retirement service providers are advocating for several legislative proposals. These recommendations will make it easier for workers to get peace of mind as they prepare for retirement.  

  1. Require all defined contribution retirement plans, including 401(k) and 403(b) plans, to offer retirees an annuity option that will provide them with a guaranteed stream of income like a pension.
  2. Update and simplify rules and language regarding options to rollover funds to an IRA or another plan to increase access to guaranteed lifetime income payments in retirement.
  3. Remove restrictions so that eligible retirement plan participants can purchase deferred income annuities at age 50, rather than waiting until age 59 ½.
  4. Amend rules so that retirees will be allowed to access non-liquid annuity benefits within a designated investment alternative and within a qualified default investment alternative.
  5. Advance policy solutions that allow employers to adopt auto enrollment and auto escalation features. 

TIAA’s Bill of Rights says that workers, employers and policymakers must join together to form a coalition of champions to help America’s workers achieve a financially secure retirement. ACLI and its member companies look forward to working together with members of Congress on both sides of the aisle to advance these proposals and help more Americans achieve stress-free financial certainty throughout retirement.

Kathleen Coulombe

Kathleen Coulombe serves as the Senior Vice President, Federal Relations, for the American Council of Life Insurers (ACLI). In this capacity, she is actively involved in a multitude of public policy issues on Capitol Hill that impact the life insurance industry.

Chris Spence

Chris Spence is Managing Director, Federal Government Relations at TIAA