New California Legislation Aims To Help Workers Without Employer-Sponsored 401k Plans

Updated : Oct 22, 2019 in Articles

New California Legislation Aims To Help Workers Without Employer-Sponsored 401k Plans


FOR RETIREMENT. BUT, THE STATE “COULD” SOON MAKE IT EASIER FOR EMPLOYEES WHO DON’T HAVE 401K PLANS AT WORK TO SOCK AWAY MONEY. CONSUMERWATCH REPORTER JULIE WATTS EXPLAINS. NEARLY HALF OF WORKERS 50 AND OLDER HAVE LESS THAN $25,000 IN SAVINGS; MORE THAN 40% OF THOSEwithin 10 years of retirement age… have NO RETIREMENT SAVINGS AT ALL. now state law makers are hoping to change that. PKG – Nat San Francisco book store owner Christin Evans, would love to offer a retirement plan to her staffâ and she’s not alone. – most small biz owners don’t offer a retirement option because it’s cost prohibitive for small biz like mine So when the heard about California’s proposed “secure choice” retirement plan, she was thrilled. It’s essentially a 401k- operated by the state – for employees of small business like hersâ – There’s a little bit of time spent in administering the plan but not any actual cost to my biz The plan will automatically opt-in about a third of California’s workforce those at companies with more than 5 workersâ without employer- sponsored 401ks â But critics cite concerns that – too many people will chose to opt-out â risking everyone’s investmentâ potentially leaving taxpayers on the hook. Secure choice participants will include younger and part time workers.. many making less than 25-thousand a yearâ. More likely to opt out when every penny counts. A problem since he says the program needs significant participation to cover costs. – The leg calls for opting out instead of opting in, I expect very high participation rate *** Financial planner Stephanie lee says opt- in programs traditionally have high enrollment And lee says – what’s good for enrollees is good for the stateâ – We want our seniors to not be in poverty because that effects all of us… But Christin says, what’s most importantâ is that her employees have optionsâ including the choice to opt out. But even though many are living pay check to pay check, paying off student loansâ – I expect that at least 2/3 of our staff will participate PROPONENTS OF THE PROGRAM – LIKE AARP – TELL US 7.5 MILLION PEOPLE CURRENTLY HAVE NO 401-K OPTION, THEY SAY, EVEN IF 2 MILLION PARTICIPATED, IT WOULD KEEP FEES LOW AND COVER COSTS. THE LEGISLATION GOES UP FOR A VOTE IN THE ASSEMBLY NEXT WEEK. IT’S ALREADY PASSED IN THE STATE SENATE. ON THE CONSUMERWATCH… JULIE WATTS, KPIX 5. A STRANGE SITE IN THE SKIES ABOVE ALAMEDA.

Leave a Reply

Your email address will not be published. Required fields are marked *