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Congress Passes Measure Making It Easier for Workers to Track Retirement Funds

The measure makes a “lost and found” database for workers to track retirement funds at places they’ve previously worked.

Sen. Elizabeth Warren speaks during a rally for Oregon gubernatorial candidate Tina Kotek on October 22, 2022, in Portland, Oregon.

A proposal to make it easier for workers to access all of their retirement funds across different employers has passed into law after being added to the omnibus funding bill last week, marking a small win for workers.

The Retirement Savings Lost and Found Act, first introduced by Senators Elizabeth Warren (D-Massachusetts) and Steve Daines (R-Montana), creates an online “lost and found” database run by the Department of Labor that would help workers find retirement funds accrued from previous employers over the years. This would allow workers to “track their hard-earned savings, maximize investment earnings, and boost retirement security,” as a Warren press release reads.

“Millions of Americans continue to lose track of their hard-earned savings when they move between jobs,” said Warren. “This provision revamps our retirement system and creates a ‘lost and found’ database to make it easier for Americans to keep track of their retirement savings and for employers to connect their former employees with the accounts they have left behind.”

The proposal was included in the omnibus funding bill that was passed last week by Congress and signed into law by President Joe Biden. The omnibus also included several other wins for workers, including protections for basic rights for pregnant workers, more funding for labor regulators and a Sen. Bernie Sanders (I-Vermont) proposal to increase worker ownership and input at companies.

Retirement and pension advocates have called for a lost and found system, and the bill has the support of organizations like AARP and the Pension Rights Center. The lawmakers say that the bill could help thousands of workers who lose track of retirement funds as companies change names, merge with other companies, terminate retirement programs or move.

This is a widespread problem: according to research by retirement-account rollover company Capitalize, by the end of 2021, there were nearly 25 million “forgotten” 401(k) accounts in the U.S., accounting for about one-fifth of all 401(k) assets in the U.S. This totals over $1 trillion in lost funds, the firm estimates.

Lost retirement funds are especially a problem as workers’ ability to retire is being eroded. Wages have been stagnating for the working class, and workers are being forced to continue working well past regular retirement age; the Bureau of Labor Statistics (BLS) has projected that the number of people 75 or older in the labor force will nearly double by 2030. Meanwhile, a Washington Post analysis found last month that the proportion of octogenarians in the workforce has soared from 2.5 percent in 1980 to 6 percent in 2019.

This could be partially due to the fact that Social Security payments are insufficient for many seniors to survive on, as the payments haven’t kept pace with the costs of living. Conservatives, however, have rebuffed Democratic and progressive lawmakers’ attempts to boost Social Security payments over the years.

The ability to track retirement funds is also crucial as young people switch jobs more often than their older counterparts. According to BLS research, as of this year, the median tenure at one job was nearly 10 years for people aged 55 to 64, while the median tenure for workers 25 to 34 is about 3 years. There are also disparities due to race, as the agency found white workers are most likely of any racial group to stay in a job longer than 10 years.

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