Should 18-year-olds have access to workplace retirement plans like 401(k)s? If bipartisan legislation reintroduced this week in Congress becomes law, they'll be able to.
A new bill, S.3305, the Helping Young Americans Save for Retirement Act, (re)introduced this past Monday, would lower the minimum age for employees participating in workplace retirement plans, like a 401(k), from 21 to 18.
As of September 30, 2024, there were about 70 million active participants enrolled in 401(k) plans, according to the Investment Company Institute (ICI). Although a company can offer a 401(k) plan to their employees under 21 years old, many do not because of high costs and red tape.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
This bill amends the Employee Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue Code of 1986 regarding minimum participation standards for pension plans and qualified trusts.
Republican Senator Bill Cassidy of Louisiana, a co-lead sponsor of the bill, said, “Americans who don’t attend college and immediately enter the workforce should be given every chance to save for retirement, Cassidy added. "This legislation empowers American workers, giving them more opportunities to plan for a secure retirement.” Cassidy chairs the Senate Health, Education, Labor, and Pensions (HELP) Committee.
In some cases, the bill would lower the age of ERISA-covered defined contribution plans to 18 years old from the current age of 21. The bill would also remove provisions that legislators say could make covering younger workers too expensive for businesses. They might include delaying ERISA guidelines that state companies must take part in audits if they allow employees under the age of 21 to contribute to retirement plans. The legislation would also exempt 18- to 20-year-old employees from nondiscrimination testing, currently required.
Due to SECURE 2.0, younger workers are more likely to be automatically enrolled in employee retirement plans, due to lower engagement; if 18- to 20-year-olds were to qualify for plans, then those who chose not to opt in would also be automatically enrolled.
The legislation has earned endorsements from several financial services and retirement planning organizations. The list includes the Insured Retirement Institute, Edward Jones, TIAA, the American Benefits Council, Transamerica and the National Rural Electric Cooperative Association (NRECA).
Current Status (as of May 2025)
The bill was first introduced in the Senate on November 15, 2023, and referred to the Committee on Health, Education, Labor, and Pensions (HELP). As of May 16, 2025, S.3305 from the 118th Congress is likely expired due to the end of the congressional session, with no recorded advancement beyond its introduction and committee referral.
Related Content
-
Such Attractive Yields in High-Grade Munis Are Rare and May Not Last LongAccording to this munis expert, the last time munis were this cheap was a brief period in 2023. If you kicked yourself for missing out then, you have a second chance now.
-
Financial Analyst Sees a Bright Present for Municipal Bond InvestorsHigh-tax-bracket investors have an excellent opportunity to secure low-volatility, high-quality returns at yield levels rarely seen in over a decade.
-
The Rule of 240 Paychecks in RetirementThe Rule of 240 Paychecks can help you plan for a lifetime of withdrawals. Because, like any good boss, you need to pay yourself wisely.
-
Two Estate Planning Issues You Should Never OverlookThis estate planning attorney explains why proper asset titling and beneficiary designations make a big difference when it's time to transfer your wealth.
-
Worried Social Security Benefits Will Be Cut? This Is How Much More You Need to Save to Be SafeThe Social Security trust fund will be insolvent in 2033 and by 2035 will have to reduce benefits by 17%. Here is now much more you need to save to cover the potential shortfall.
-
The Odd Couple: Renting Out a Room in RetirementWhether you're more Golden Girls or Felix Unger, renting out a room in retirement might make financial sense. You might even have fun.
-
How to Be Your Own Consumer WatchdogBig changes are afoot at federal agencies. Make these moves to protect yourself financially.
-
The Three Retirement Tax Issues I Nag My Clients AboutA financial professional highlights areas of tax planning that retirees should have on their radar as they finalize their retirement plan.
-
How to Age Gracefully: Learn from Bill Gates, the Who and David AttenboroughGetting old isn’t nearly as bad as many people think it will be. Nor is it quite as good. Maybe it’s somewhere in between.
-
I'm 60 with $4 Million — Can I Have a Luxury Retirement?With inflation and volatility, how careful should I be?
