Page 10 - Investment Advisor February/March 2023

Beginnings

WASHINGTON WATCH

By Melanie Waddell

Secure 2.0 Is Here, but Expect a Slow Rollout

Some of the changes mandated in the law may take years to materialize —

if they ever do, according to several industry experts.
W hile the Setting Every ments as well as the Pension Benefit
The Treasury and Labor Depart-
Community
for
Up
Retirement Enhancement
(Secure) 2.0 Act of 2022 is now law, Guaranty Corp., for instance, “take very
seriously the statutory deadlines for
some of the regulations mandated in the issuing regs or other guidance,” Iwry
sweeping reform legislation may take added. “Sometimes, though, despite
years to come to light — if they ever do. their best efforts, a few of the deadlines
President Joe Biden signed Secure simply turn out to be impossible for
2.0 as part of a $1.7 trillion spending bill. them to hit.”
The new retirement law includes effec- While Secure 2.0 makes the retire-
tive dates that run the gamut from now ment system “more workable in a vari-
to the 2030s as well as dates for when ety of ways, the bill delivers a boatload
agencies are to implement guidance or of changes for advisors, plan sponsors,
issue regulations. and other stakeholders to keep track
Like the Pension Protection Act of of and a long to-do list for regula-
2006, “there is a lot here [in Secure 2.0] engagement,” notes Jeff Bush of The tors,” he explained. Secure 2.0 does
to digest,” said Steve Saxon, partner at Washington Update. not “reduce complexity.”
Groom Law Group. “Given how slow In setting a timeline for a regulatory Raymond James’ analysts noted in a
things were moving even before Secure action, “Congress considers the urgency recent Washington Policy email briefing
2.0, it stands to reason that the IRS and of the matter, how quickly stakehold- that Secure 2.0 “goes well beyond the
DOL will get bogged down in issuing ers will need the guidance, and how original iteration and seeks to expand
necessary guidance in a timely manner. long it’s reasonable to assume it will participation in retirement savings plans
It will be a very slow process.” take for guidance to be issued,” adds J. through mandatory enrollments as well
As is the case with the Dodd-Frank Mark Iwry, head of national retirement as increased flexibility in the individual
Act of 2010 — which has taken more policy during the Obama-Biden admin- use of advantaged savings accounts.”
than a decade to implement, with man- istration and now a nonresident senior Secure 2.0, housed in Division T
dates still outstanding — the agencies fellow at the Brookings Institution in of the Consolidated Appropriations
charged with Secure 2.0 duties may Washington. Act of 2023, contains 90 provisions
never fulfill them. “It’s never been a high priority for “aimed at modernizing the retirement
Some of the Secure 2.0 provisions Congress to coordinate regulatory dead- system, encouraging additional retire-
“require the arduous and lengthy pro- lines for different provisions in the ment savings, and easing administra-
cess of changing or rewriting regula- aggregate and determine how feasible tive requirements,” explained Groom
tions,” which often “get bogged down the deadlines are, taken together, and Law Group in releasing a chart sum-
with cross-agency turf wars, pub- taking into account the agencies’ overall marizing all of Secure 2.0’s provisions Adobe Stock
lic comment periods, and K-Street resulting work burden,” Iwry said. and their effective dates.

8 INVESTMENT ADVISOR FEBRUARY/MARCH 2023 | ThinkAdvisor.com