U.S. Senators Todd Young (R-Ind.) and Cory Booker (D-N.J.) applauded the passage of their Emergency Savings Act by the U.S. Senate Health, Education, Labor & Pensions (HELP) Committee yesterday, as part of S. 4353, Retirement Improvement and Savings Enhancement to Supplement Healthy Investments for the Nest Egg (RISE & SHINE) Act. The bipartisan bill was introduced last month to help Americans save for unexpected expenses without having to tap into their retirement accounts.
“This action by the HELP Committee puts us one step closer to helping Americans better save for emergencies and preserve their retirement savings. The Emergency Savings Act enjoys support from across the retirement industry and political spectrum. It is a commonsense solution to an unfortunately too-common problem: Americans who find themselves without sufficient savings to cover unexpected emergencies,” said Senators Young and Booker.
According to a report by the Federal Reserve, almost half of Americans would struggle to cover an unexpected $400 expense. A recent study found that, in the past year, almost 60 percent of retirement account participants who lack emergency savings tapped into their long-term retirement savings, compared to only nine percent of those who had at least a month of emergency savings on hand.
The Emergency Savings Act would facilitate convenient and affordable access to workplace emergency savings accounts, improving financial security and reducing retirement savings leakage. The bill builds upon work by Senators Young and Booker to develop this concept over the last several years, including the Strengthening Financial Security Through Short-Term Savings Accounts Act of 2021.
To hear what supporters of the Emergency Savings Act are saying, click here.