WEST PALM BEACH, Fla. — In the coming days, lawmakers will vote on a spending bill that could have a major impact on promoting retirement savings.
WPTV spoke with a financial expert who explained how parts of the Secure 2.0 Act may help people save more earlier in life.
Experts recommend that workers put 15% of their annual gross salary into a retirement saving plan, but inflation is making that nearly impossible for many people.
Congress is taking up a spending bill with provisions that will make it easier to create a retirement plan.
When Christina Anthony got married three years ago, she had plans to buy a home with her husband, start a business and save money together.
"Paying bills on time, keeping a good credit score is probably the most important thing right now," Anthony said. "Savings hasn't even been on the top of the list anymore, which is a new thing for us."
Instead of saving for retirement, she's had to pull money out of her 401(k).
"Especially right now with the economy the way it is with inflation, they just don't have the funds to actually allocate that," Charles Czajka, the CEO of Macro Money Concepts, said.
Czajka said that's why provisions in the Secure 2.0 Act, part of the spending bill that Congress is voting on this week, will help people plan for retirement.
Among the provisions are to require employers to automatically enroll employees in 401(k) plans and allow people older than 60 to contribute $10,000 over the max.
Financial expert Mark Parks of Preveer Corporation said a major incentive of the bill will allow investors to take out up to $1,000 in emergency money out of their 401(k) penalty-free.
"Prior to that, you would have to pay a penalty to access your own money, so that would keep people out of those plans," Parks said.
Many of these provisions, if passed, would not go into effect for another year, others not for several years.
Anthony said she hopes to catch up on savings soon.
"When I'm older I want to at least work because I love my job, or whatever my work is, so I don't want to work forever because I'm required to," Anthony said.
