President Donald Trump is expected to sign an executive order today directing the government to review rules requiring retirees to start taking annual withdrawals from retirement funds after they turn 70 ½ and to consider making it easier for small businesses to offer employees 401(k) plans.
The Wall Street Journal reports the action, expected to be signed during a ceremony in Charlotte, North Carolina, is being billed by the White House as a push to better prepare workers for retirement.
As part of the initiative, the Treasury Department would review the rules on required minimum distributions from retirement plans to see if investors can keep more money for a longer time in 401(k)s, individual retirement accounts and other tax-sheltered savings plans. If successful, it could allow retirees to spread retirement savings over a longer period.
The executive order also would direct the Treasury and Labor departments to consider issuing regulations that could make it easier and cheaper for smaller employers to band together to offer 401(k)-type plans for their workers.
“These plans like other plans have large overhead and department costs,” says James Sherk, special assistant to Trump for domestic policy. “Large employers can enjoy economies of scale by spreading those costs among larger groups of workers. Small businesses don’t have the luxury of doing that.”
The arrangement has been available, but only to employers with an affiliation or connection, such as members of the same industry trade association.
