Retirement savings have usually been one of the few areas where Republicans and Democrats agree. The SECURE Act of 2019 passed with large bipartisan majorities. In 2021, that consensus was briefly tested when retirement provisions were folded into Democrats' party-line reconciliation bill.
The 2021 tension
The Build Back Better Act, which Democrats tried to pass through budget reconciliation without Republican votes, included retirement changes: proposals for automatic IRAs for workers without a workplace plan in early drafts, and restrictions on large retirement accounts and backdoor Roth conversions for high earners. Republicans objected that measures with bipartisan support were being mixed into a partisan package. The bill passed the House in November 2021 but stalled in the Senate.
SECURE 2.0
A separate bipartisan effort continued. The SECURE 2.0 Act of 2022 was passed as Division T of the Consolidated Appropriations Act, 2023, which became law on 29 December 2022. Among its many provisions:
- raising the age for required minimum distributions to 73 from 2023, and 75 from 2033;
- requiring most new 401(k) and 403(b) plans to enrol employees automatically, starting in 2025;
- allowing employer matches based on student loan payments;
- creating a federal Saver's Match for lower-income savers from 2027;
- higher catch-up contribution limits for people aged 60 to 63, and a requirement that high earners make catch-up contributions on a Roth basis;
- allowing limited penalty-free withdrawals for emergencies and for victims of domestic abuse.
What it shows
Retirement policy remains largely bipartisan in substance. The 2021 episode showed how procedure can disrupt that: provisions that might pass easily on their own become contentious when bundled with unrelated, partisan measures. Many SECURE 2.0 provisions are still being phased in, and the IRS continues to issue guidance on how they work.
Sources
General information about the law as it stood when this page was updated, not financial, tax or legal advice. Rules and limits change; check the official source or a qualified adviser before acting.