New research finds strong support for state-facilitated retirement programs for workers lacking workplace plans

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A new national survey of working-age Americans from the National Institute on Retirement Security (NIRS) finds strong support for new state-facilitated retirement programs that are focused on helping workers without employer-provided plans save for retirement.

More than three-fourths of Americans (77 percent) agree that state-facilitated retirement programs are a good idea. And at a time when the nation faces deep political division on a broad range of issues, support for state-facilitated programs holds strong across party lines. Among Democrats, 86 percent agree these retirement plans are a good idea, as do 74 percent of Republicans and 71 percent of Independents. 
 
These findings are detailed in a new issue brief from NIRS, Americans’ Views of State-Facilitated Retirement Programs. The findings are based upon a national survey of working-age Americans conducted by Greenwald Research.

Read the issue brief here.
 
This issue brief is a supplement to a recent NIRS report, Retirement Insecurity 2024: Americans’ Views of Retirement. Read the report here.
 
“It’s so encouraging that nearly every state is examining options for expanding access to retirement plans for workers lacking plans at their job,” said Dan Doonan, NIRS executive director and report co-author. “And it is equally encouraging that Americans overwhelmingly agree that the state plans are a good idea and that they would participate.”
 
“Looking ahead, it will be important to watch for additional innovations as more states establish these savings programs and existing programs grow. For example, states already are joining together in multi-state compacts. It also will be interesting to see if the state programs spur growth in 401(k) plan offerings, especially given that SECURE 2.0 provisions will make it easier for small businesses to offer retirement plans. Overall, actions at the federal level coupled with the state-facilitated retirement programs are steps in the right direction toward solving the alarming retirement savings shortfall facing most working Americans,” Doonan said. 
 
This research’s key findings are as follows: 
 
• The vast majority of Americans (77 percent) agree that state-facilitated retirement savings programs are a good idea. There is high support across party and generational lines, with support highest among Millennials (79 percent).

• More than three-quarters of Americans (82 percent) say they would participate in state-facilitated retirement programs, up from 75 percent in 2020. The support is consistent across party and generational lines.

• Americans view many key features of state-facilitated retirement programs as highly favorable, especially that the programs would provide higher returns than other safe investments in today’s market (87 percent) and have low fees (86 percent).
 
This research comes as the U.S. faces a retirement savings crisis, with about half of American households “at risk” of not having enough to maintain their living standards in retirement according to the Boston College Center for Retirement Research. Employer-sponsored retirement plans are the main vehicle for workers to save for retirement, and this is a major contributing factor as U.S. employers are not required to offer any type of retirement savings plan. According to the Georgetown University Center for Retirement Initiatives (CRI), about half of the private-sector workforce (57 million employees) does not have access to an employer-sponsored retirement savings plan.
 
Amid this crisis, states are taking action to address the retirement challenges facing Americans by providing increased access to retirement plans. Since 2012, every state except Alabama has either enacted or introduced legislation that would establish state-facilitated retirement savings programs according to CRI. These state-facilitated retirement programs offer a backstop for those working in jobs where employers do not offer retirement plans like a pension plan or 401(k) account. While each program is different, the most popular type of plan that states are enacting automatically enrolls workers in moderate risk, low-cost retirement savings accounts referred to as auto-IRAs. Broadly, the state-facilitated programs require private sector employers lacking retirement plans to provide their employees with access to retirement accounts through payroll deductions. While these programs are overseen and administered by the state, investments are managed by private companies. Workers in states that offer these plans can access these retirement savings accounts when they retire.

Read the research here.

The National Institute on Retirement Security is a nonprofit, nonpartisan organization established to contribute to informed policymaking by fostering a deep understanding of the value of retirement security to employees, employers and the economy as a whole. Located in Washington, D.C., NIRS membership includes financial services firms, employee benefit plans, trade associations and other retirement service providers. More information is available at www.nirsonline.org.

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