Compliance May 13, 2025

Senate Bill Would Expand Retirement Plan Access to Younger Americans

Several organizations offered support for the legislation, including TIAA and the Insured Retirement Institute.

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Two senators reintroduced a bill on Monday that would expand access to employer-sponsored retirement plans for Americans aged 18 through 20 years old.

The Helping Young Americans Save for Retirement Act, introduced by Senator Bill Cassidy, R-Louisiana, chair of the Senate Health, Education, Labor, and Pensions Committee; and Senator Tim Kaine, D-Virginia, a member of the Senate HELP Committee, would lower to 18 the age at which plan participants must be permitted to participate in defined contribution plans governed by the Employee Retirement Income Security Act.

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The original bill, introduced in November 2023 by Cassidy, Kaine and several other senators, was referred to the Committee on Health, Education, Labor, and Pensions, but did not advance.

The legislation also includes provisions that would make it less costly for employers to extend benefits to younger employees.

The bill would delay ERISA provisions that require companies to undergo mandatory audits if they allow employees younger than 21 to contribute to a pension and would exempt 18-through-20-year-old employees from testing of their funds, which would further reduce the administrative costs for employers.

“Americans who don’t attend college and immediately enter the workforce should be given every chance to save for retirement,” Cassidy said in a statement. “This legislation empowers American workers, giving them more opportunities to plan for a secure retirement.”

Several organizations offered support for the legislation, including the Teachers Insurance and Annuity Association of America and College Retirement Equities Fund and the Insured Retirement Institute.

“By lowering the age at which an individual can access their workplace retirement plan from 21 to 18, the Helping Young Americans Save for Retirement Ac helps workers start saving earlier,” Kourtney Gibson, TIAA’s CEO of retirement solutions, wrote in a letter to the senators. “We know from experience that the sooner one starts saving, the better off they will be in the future and the more likely they will be to have adequate income in retirement.”

“The Helping Young Americans Save for Retirement Act will expand the opportunity for more younger workers to start saving earlier for retirement by allowing them to participate in their employer-sponsored workplace plans,” said a statement from Paul Richman, Chief Government and Political Affairs Officer at the Insured Retirement Institute. “This measure will not only help younger workers get into the habit of contributing to their retirement savings, but it will also provide additional years for their savings to grow to ensure a more secure financial future.”

Data & Research May 13, 2025

In Q1, 529 and ABLE Account Assets Continue Steady Growth

The majority of the assets, $500 billion, are held in 16.3 million 529 savings plan accounts, while prepaid tuition plans held steady at $25 billion across roughly 900,000 accounts.

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The 529 savings market continued to gain momentum in the first quarter of 2025, with total assets exceeding $525 billion across 17.2 million accounts, according to data from ISS Market Intelligence, which, like PLANADVISER, is owned by ISS STOXX.

The Q1 total is up from $497 billion across 16.6 million accounts one year prior.

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The majority of the assets, $500 billion, are held in 16.3 million 529 savings plan accounts, while prepaid tuition plans held steady at $25 billion across roughly 900,000 accounts. 

Meanwhile, ABLE (or 529A) accounts, which offer tax-advantaged savings for individuals with disabilities, grew to 204,133 accounts holding $2.47 billion in assets, up from 194,728 accounts and $2.31 billion at the end of 2024 and 170,955 accounts with $1.92 billion invested one year ago.

Estimated net inflows into 529 savings plans reached $2.2 billion in Q1 2025, slightly outpacing the $2.1 billion in Q1 2024 and continuing an upward trend from $1.6 billion in Q1 2023.

According to the report, this reflects not only parents’ continued focus on funding education despite market volatility, but also growing awareness of the expanded uses for 529 plans.

“The overall outlook for 529s continues to brighten,” the report stated, pointing to the expansion of qualified expenses that now include certain types of rollovers from 529s to Roth individual retirement accounts.

The report also predicted this shift would energize new stakeholder interest and drive growth over the next three to five years, especially as families increasingly integrate 529 strategies into their tax, estate and financial planning playbooks.

The SECURE 2.0 Act of 2022 allowed certain assets in a 529 qualified tuition program account, maintained for at least 15 years for a designated beneficiary, to be directly rolled over on a tax-free basis to a Roth IRA maintained for the same beneficiary.

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