A final rule should be out in the next few weeks that would allow defined benefit proceeds to be more easily invested in annuities and lump sums, Treasury Department retirement policy advisor Mark Iwry said Monday.

The new rule would make it easier for sponsors to offer a mix of alternatives for investing defined plan distributions, Iwry said. “Lots of plans do not offer that mix but all of them can. We want to discourage plans from an all-or-nothing choice,” Iwry told the Insured Retirement Institute’s Government, Legal & Regulatory Conference in Washington, D.C. IRI is the largest trade association for the annuities industry.

The Treasury Department’s lead official on retirement issues said too many people are taking all of their defined benefit plan distribution as a lump sum, but they would be better off if they put some of that money into annuities so they would get guaranteed life income streams.

On another issue, Iwry said legislation to make it easier for small plans to join together to offer 401(k)s is moving “reasonably well” through Congress.

He said he hopes the legislation can become law this year.

Proponents of the proposal for such plans, Open MEPs (Multiple Employer Plans), said it will put more of the 50 million American households without workplace retirement plans under an employer-sponsored plan by giving small businesses the advantage of lower costs and administrative burdens of a combined plans.

Currently, small businesses must share some common features to join together for 401(k) offerings.