California Shows How to Fill the Retirement Security Void

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Media Outlet: The Hill

Reid Cramer wrote for the Hill about California's new state-run retirement plan:

California Gov. Jerry Brown (D) just signed a bill that will provide a major assist to workers who need help saving for their future. By creating the California Secure Choice Retirement Savings Program, the state is creating its own 401(k)-type plan and almost everyone in the workforce who doesn't have his or her own plan already will be automatically enrolled. In California, that's almost 7 million workers, many of whom aren't setting aside any money to augment their Social Security benefits.
With Secure Choice, these workers will have up to 5 percent of their income deducted from their paycheck and deposited into a personal account. They can opt out if they choose. If they stay in, they can benefit by participating in a pooled fund with low fees, economies of scale and a mandate for strong consumer protections that is designed to maximize retirement security.

Author:

Reid Cramer is director of the Millennials Initiative at New America. Previously, he served as the Asset Building program's research director and as a co-director of New America's Next Social Contract Initiative.