Sponsors (10)
Introduced April 7, 2025 by Lloyd K. Smucker · Last progress April 7, 2025
The bill greatly expands access to professionally managed, low‑cost retirement accounts with automatic enrollment and federal matching—helping many gig, low‑ and middle‑income workers save for retirement—but does so at increased fiscal cost, added employer and government administrative burdens, and with remaining investment and legal risks for participants.
Millions of independent workers, low‑ and middle‑income families, and employees of small businesses gain access to a centrally managed, low‑cost retirement account with automatic employer enrollment (3% default), diversified investment options, and Treasury matching—making it far easier to start and grow retirement savings.
Low‑income people, people with disabilities, and older adults can hold AWRF/Fund accounts without losing eligibility for Medicaid and other means‑tested programs, and Fund payments are structured not to reduce Social Security benefits, preserving safety‑net access while allowing saving.
The bill creates a governance and oversight structure (Board, Executive Director, Investment Advisory Council), fiduciary duties, audit authority, enforcement mechanisms, and limits on administrative costs and concentration risk—intended to keep the Fund professionally managed and protect participants.
The program increases federal fiscal exposure—refundable credits, Treasury matching, potential additive Fund payments to Social Security, and more people remaining eligible for benefit programs could raise costs for taxpayers.
Small businesses and employers face new compliance obligations, potential penalties (2–10% for missed deposits), and administrative costs to enroll workers and remit contributions, which could be burdensome for small employers.
Participants remain exposed to investment losses and fiduciary risk; limits on suing Board members (monetary damages barred) and restrictions on voting rights in pooled investments could reduce private remedies and participant control if losses or breaches occur.
Based on analysis of 12 sections of legislative text.
Creates the American Worker Retirement Fund and Board, opens participant accounts, and provides a refundable government matching tax credit deposited into those accounts.
Creates a new federal retirement system that opens individual accounts for workers who lack access to an employer retirement plan. The law sets up the American Worker Retirement Fund to hold participant accounts, creates a five-member American Worker Retirement Investment Board to manage investments and administration, and starts a refundable Government Match Tax Credit that deposits matching funds into participants’ accounts. The bill also protects account balances from being counted for most federal benefit eligibility, limits legal claims against accounts (with exceptions for child support and tax levies), requires financial-literacy steps before some withdrawals or loans, and sets rules for investment options, fiduciary duties, and forfeiture if matching credits are withdrawn too soon.