KENNEDY GRAD STUDENT SAVINGS ACT PASSES HOUSE
Bipartisan bill helps graduate students save for retirement
Washington, D.C. – Congressman Joe Kennedy III today applauded the passage of the Graduate Student Savings Act as part of the Congressional spending agreement. The legislation will allow graduate school students to place taxable stipend or fellowship income into an Individual Retirement Account (IRA). By classifying this income as “compensation”, the Graduate Student Savings Act removes barriers to retirement savings for nearly a million students.
“Working students should not be denied the chance to save for retirement simply because they’re pursuing a higher education,” said Congressman Kennedy. “With the passage of the Graduate Student Savings Act, we will tear down a barrier that limits the financial security of students and deter Americans from pursuing advanced degrees.”
A majority of doctoral students report receiving some of their financial support during graduate school from fellowships or grants, and about a third of all students report that fellowships or grants were their primary source of funding. The median doctoral student takes about seven years to finish a degree – meaning that, for the better part of a decade, a student can be prohibited from saving major portions of their income in a tax-advantaged account. This bill would remove this unnecessary hurdle so that students and postdoctoral fellows can start saving immediately.
Congressman Kennedy originally introduced the Graduate Student Savings Act in 2016. Senators Elizabeth Warren (D-MA), Mike Lee (R-UT), Ron Wyden (D-OR), and Tim Scott (R-SC) introduced companion legislation in the United States Senate.
For Immediate Release:
December 17, 2019
Dan Black (202) 225-5931
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