WASHINGTON – Aiming to expand retirement opportunities for employees of non-profit organizations, a bipartisan group of senators, including U.S. Sen. Katie Britt, introduced legislation to answer that need.
Britt (R-Montgomery) and Sens. Raphael Warnock (D-Ga.), Dr. Bill Cassidy (R-La.), and Gary Peters (D-Mich.) introduced the Retirement Fairness for Charities and Educational Institutions Act, to enhance investment options for 403(b) retirement plans. The 403(b) plans are a type of retirement savings plan, similar to a 401(k), offered to employees of non-profit organizations, like public universities, hospitals, churches, and charities.
“Americans serving in the non-profit sector should have the ability to access retirement resources that fit their needs,” said Britt. “Through the Retirement Fairness for Charities and Educational Institutions Act, Americans in the non-profit sector would be able to access the same investment options available to those in the private sector.
“It levels the playing field so that more hardworking Americans can access retirement sooner.”
The Retirement Fairness for Charities and Educational Institutions Act would expand retirement savings opportunities for non-profit employees by allowing 403(b) plan participants to invest in collective investment trusts (CITs), the senators said. A CIT is a tax-exempt investment vehicle that provides a diversified, pooled investment option — similar to a mutual fund.
Under current law, unlike 401(k) holders, 403(b) plan sponsors are not able to use this stable, lower-cost investment option in their plan. This legislation would create parity between 403(b) and 401(k) retirement savings plans, benefitting over 15 million hardworking employees at hospitals, universities, charities, and other non-profit organizations, they said.
“Every hardworking American retiree deserves financial security, especially those who dedicate their lives to serving their country and communities. But too many folks still struggle to save up and prepare for retirement in our rapidly evolving economy,” said Warnock. “I’m championing the Retirement Fairness for Charities and Educational Institutions Act to give non-profit employees access to the same retirement investment opportunities private sector employees have.
“This bipartisan bill will help ensure more workers can retire with dignity.”
The Retirement Fairness for Charities and Educational Institutions Act has received significant support, including the American Retirement Association, Investment Company Institute, American Heart Association, American Council of Life Insurers, Habitat for Humanity, National Council of Nonprofits, Council on Foundations, Lutheran Services of America, United Way, and Securities Industry and Financial Markets Association.
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