Maximize Americans' Retirement Security Act
Bill: S.4613 | Sponsor: Sen. Braun, Mike (R-IN)
Policy area: Labor and Employment

Summary:
Maximize Americans' Retirement Security Act
This bill revises the fiduciary duties for a retirement or employee benefit plan that is regulated under the Employee Retirement Income Security Act of 1974.
The bill generally requires a fiduciary to select and maintain investments for a plan based solely on pecuniary factors. Under the bill, a pecuniary factor is a factor that is expected to have a material effect on the risk or return of an investment based on appropriate investment horizons that are consistent with the plan's investment objectives and funding policy.
A fiduciary may only use nonpecuniary factors if the fiduciary is unable to distinguish between investment alternatives on the basis of pecuniary factors alone. In such a case, the fiduciary must provide specified documentation to the plan's participants and beneficiaries, including an explanation of how the chosen nonpecuniary factors are consistent with their interests.

To amend the Employee Retirement Income Security Act of 1974 to clarify 
   the fiduciary duty of plan administrators to select and maintain 
 investments based solely on pecuniary factors, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Maximize Americans' Retirement 
Security Act''.

SEC. 2. FIDUCIARY DUTY REGARDING THE CONSIDERATION OF CERTAIN FACTORS 
              IN INVESTMENT DECISIONS FOR EMPLOYEE BENEFIT PLANS.

    (a) In General.--Subsection (a) of section 404 of the Employee 
Retirement Income Security Act of 1974 (29 U.S.C. 1104) is amended by 
adding at the end the following new paragraph:
    ``(3)(A) The duties under paragraph (1) shall include the duty to 
select and maintain investments based, except as provided in 
subparagraph (B), solely on pecuniary factors.
    ``(B) Notwithstanding subparagraph (A), when choosing between or 
among investment alternatives that a fiduciary is unable to distinguish 
on the basis of pecuniary factors alone, the fiduciary may use non-
pecuniary factors as the deciding factor in the selection or 
maintenance of an investment if the fiduciary furnishes to participants 
documentation on the following:
            ``(i) Why pecuniary factors were not sufficient to select 
        or maintain the investment.
            ``(ii) How the investment compares to the alternative 
        investments with regard to--
                    ``(I) the composition of the investments of the 
                plan with regard to diversification;
                    ``(II) the liquidity and current return of the 
                investments of the plan relative to the anticipated 
                cash flow requirements of the plan; and
                    ``(III) the projected return of the investments of 
                the plan relative to the funding objectives of the 
                plan.
            ``(iii) How the chosen non-pecuniary factor is consistent 
        with the interests of participants and beneficiaries in their 
        retirement income or financial benefits under the plan.
    ``(C) For purposes of this paragraph, the term `pecuniary factor' 
means a factor that a fiduciary prudently determines is expected to 
have a material effect on the risk or return of an investment based on 
appropriate investment horizons consistent with the plan's investment 
objectives and the plan's funding policy established pursuant to 
section 402(b)(1).''.
    (b) Effective Date.--The amendment made by this section shall apply 
to investments made after the date that is 60 days after the date of 
enactment of this Act.
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