The Secure Choice legislation recently introduced by the AARP in Nevada offers employees of small businesses the opportunity to save money for retirement through payroll deduction, even if their employer doesn’t offer a 401(k). This is quite helpful, considering most people entering retirement have less than $25,000 saved.
There’s a similar plan in place in Oregon. This voluntary program offers employees of private companies the same opportunity to save as those who work for larger firms with 401(k) programs. The Individual Retirement Account is managed by a private firm and overseen by the state. The account is portable, so if the employee leaves the company they can take their retirement account with them.
Americans are much more likely to save a significant amount of money to fund their retirement if they can do so through an automatic payroll deduction. About 90% of workers currently save through their company’s program if one is available.
Several states are looking at or have passed similar measures to extend retirement savings plans with payroll deduction to their workers. New York State recently passed similar legislation as part of their 2018-2019 state budget, though it’ll take a couple of years for the system to be fully functional.
