Key components of the Sen. Hickenlooper's legislation include:

Eligibility and auto enrollment: Full- and part-time workers who lack access to an employer-sponsored retirement plan would be eligible for an account, and they would be automatically enrolled at 3% of their income. They could choose to increase or decrease their withholding, or opt out entirely at any time. Independent workers (including gig workers) would also be eligible. Highly compensated employees would be required to roll their funds over or have them disbursed.
Federal contribution: Low- and moderate-income workers would be eligible for a 1% automatic contribution (as long as they remain employed) and up to a 4% matching contribution via a refundable federal tax credit. This would begin to phase out at median income.
Portability: Accounts would remain attached to workers throughout their lifetimes, and workers would be able to stop and start contributions at will.
Private Assets: The accounts would be the property of the worker and the assets could be passed down to future generations to help them build wealth and financial security.
Investment options: Much like the current TSP, participants would be given a menu of simple, low-fee investment options to choose from, including lifecycle funds tied to a worker's estimated retirement date, or index funds made of stocks and bonds.

Related: Could a whole new government-backed program close the retirement savings gap?

The RSAA bill is modeled after the highly successful retirement plan for members of the uniformed services and federal workers. Yet the 5% federal match remains a significant concern for opponents of the bill, including the American Retirement Association. The ARA argues the match would strongly encourage employers to terminate their 401(k) in favor of the federal plan, eventually "crowding out" the country's private, employer-based retirement saving system.

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A new federal 401(k) match retirement plan for low-income workers is in the works

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