Eliminating Arbitrary Age Descrimination in 401(K) and Pension Plan Eligibility Requirements: A Simple Fix to Encourage Younger Workers to Save for Retirement

Current federal law allows companies to exclude their youngest workers from participating in 401(k) and other pension plans. Public policy should encourage young workers to contribute to retirement as early as practicable, rather than impose obstacles to saving. Workers who begin saving even a few years earlier improve their retirement security and reduce the likelihood they will be dependent on the government later in life. While “age discrimination” is conventionally thought of as the mistreatment of older workers, this concept applies equally to employees who are differentiated based solely on their young age. Thus, Congress should amend the Internal Revenue Code to prohibit retirement savings discrimination on the basis of (young) age