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New bill helps people plan for retirement / Public News Service

A new bill in Congress will help people across the United States prepare for retirement more easily.

The EARN law – abbreviation for Enhancing American Retirement Now – reduces the obligation for part-time workers to participate in pension plans, allows emergency withdrawals without penalty from retirement accounts and encourages small businesses to adopt pension plans.

AARP Connecticut State Director Nora Duncan said she thinks it will expand people’s options when considering retirement planning.

“As Social Security continues to be the foundation of retirement income for American workers and their families,” Duncan said, “individuals want and need additional sources of retirement income in order to live as they choose. in getting older”.

The EARN Act comes just like Connecticut has become one of the few states to have state pension planswhich Duncan says could help companies of all sizes establish some sort of retirement plan.

Other states with these types of plans include California, Oregon, and Illinois. Although these plans are relatively new, Pew Research Center data shows that these plans have grown steadily since their inception.

Although the EARN Act is still relatively new, Duncan said she sees potential opposition to it from the financial industry regarding how people receive their statements.

According to AARP datamore than half of adults with employer-sponsored pension plans would prefer paper statements.

She said she thinks some of the benefits of the new bill also come with downsides.

“Being able to qualify for workplace retirement savings in two years of part-time work at a company instead of three really makes it easier to save for retirement,” Duncan said. “But that’s not particularly helpful for the many older workers who can only find part-time work.”

She added that it might also not be helpful for people who have to work part-time, due to their caring responsibilities.

But, the EARN Act has received strong bipartisan support in Congress, offering the possibility of its safe passage in the coming months.

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