Underwood, Murray Introduce Legislation to Protect Women’s Retirement Security
WASHINGTON– Today, Congresswoman Lauren Underwood (IL-14) and U.S. Senator Patty Murray (D-WA) introduced the Women’s Retirement Protection Act of 2021 (WRPA), legislation to address the retirement gap and bolster women’s financial security. The introduction comes in light of the COVID-19 pandemic and economic crisis that have disproportionately impacted women, particularly women of color—with a recent survey finding that 40 percent of women said they expect the past year to have a long-term impact on their finances.
“As women strive for economic equality in this country, we need to make sure they have the opportunity for stable, secure retirement. That includes ensuring a woman’s spouse cannot alter their shared retirement savings without her consent. I’m honored to work with Senator Murray to strengthen consumer protections for retirement that address the economic inequalities that compound throughout a woman’s life,” said Rep. Lauren Underwood.
“COVID-19 has upended the finances of families across the country and led to severe job loss, especially in sectors like child care that disproportionately employ women, particularly women of color. Even before this pandemic, women in America typically had less money saved for retirement, in part because they were paid less than their male counterparts for the same work throughout their careers,” said Senator Patty Murray, chair of the Senate Health, Education, Labor, and Pensions (HELP) Committee. “Inequities, like investments, compound over time—which is why it is so critical we take action now to address how this pandemic and other challenges are undermining women’s financial futures. So today, I’m reintroducing the Women’s Retirement Protection Act to help women get the tools and resources they need to support themselves and their families throughout their lives.”
Even before the COVID-19 pandemic, data has long shown women’s financial futures are undermined by other factors. According to the National Women’s Law Center, the average woman loses more than $400,000 over a forty-year career due to pay inequality, requiring women to work for almost a decade longer than their male counterparts to make up the gender wage gap. Women are also more likely to be part-time workers—which can limit their access to employer-sponsored retirement plans. They may also be prevented from securing the retirement resources they are entitled to following a divorce due to barriers like complex rules and legal fees—as discussed in a 2020 report from the Government Accountability Office.
The WRPA includes a set of solutions that work to close the retirement gap by addressing some of the challenges that disproportionately affect women as they plan for their financial futures. The legislation would strengthen consumer protections to safeguard retirement savings, increase eligibility for employer-sponsored retirement savings plans for part-time workers, increase access to information about retirement and savings tools, and help women with low incomes and survivors of domestic abuse get the retirement benefits they are entitled to following a divorce.
- Strengthen consumer protections to safeguard retirement savings by expanding existing spousal protections for defined benefit plans to defined contributions plans to prevent one spouse from making decisions that might undermine a couple’s retirement resources without the other’s knowledge and consent;
- Ensure more part-time workers are offered retirement savings plans by expanding the minimum participation standards for part-time workers—most of whom are women. The SECURE Act established retirement plan eligibility for such workers after three years with an employer—WRPA would reduce that to two years;
- Increase access to information about retirement and savings tools by providing grants for community-based organizations to help provide information and financial tools to women who are of working or retirement age;
- Support women with low incomes and survivors of domestic abuse seeking retirement benefits by providing grants for community-based organizations that assist them in obtaining qualified domestic relations orders, the legal instruments that allow for the division of retirement benefits—assuring they receive the retirement benefits they are entitled to following a divorce or legal separation.
In the House, it is co-lead by Representatives Jan Schakowsky (D-IL), Suzanne Bonamici (D-OR), and Donald Norcross (D-NJ).
“Women, especially women with low incomes and women of color, were facing a retirement crisis even before the pandemic. Without swift and targeted action, women will feel the impact of the past year and a half of economic devastation for the rest of their lives. The Women's Retirement Protection Act will take meaningful steps to safeguard and protect women's retirement security," said Amy Matsui, Director of Income Security at the National Women’s Law Center.
“We applaud Senator Murray and Congresswoman Underwood for their efforts to address inequities that women face in the retirement system. The Women’s Retirement Protection Act of 2021 will expand coverage for part-time workers, provide help for women in obtaining a share of their former spouse’s retirement benefits at divorce, and improve spousal rights in 401(k) plans, all very important measures to improve retirement security for women,” said Karen Friedman, Executive Director of the Pension Rights Center.
The legislation is endorsed by: AARP, National Women’s Law Center, and Pension Rights Center.