Republicans take aim at California's retirement dream
Nancy Harvey has a goal. “I’d like to retire before dying,” she said.
Harvey, 55, has almost nothing saved for retirement. She’s a child-care provider in Oakland, Calif., and there isn’t much left over at the end of the month. “It’s not a lucrative field,” she said.
She was looking forward to a new way to save, courtesy of her home state’s government. The California Secure Choice Retirement Savings Program would create state-sponsored individual retirement accounts. Employers would be required to offer their own retirement plans or sign workers up for the voluntary IRAs. Four other states—Illinois, Maryland, Oregon, and Connecticut—are launching similar programs, also designed to make it easier to save on the job through payroll deductions.
Now lawmakers in Washington are threatening to end the states’ auto-IRA programs before they start, setting up another likely confrontation between the Trump administration and Democrat-run state governments such as California’s.
Republican lawmakers and financial industry lobbyists argue that the state auto-IRA programs put an extra burden on employers, could end up charging high fees, and improperly skirt strict regulations governing retirement plans.
The states and their defenders, which include AARP, the retiree group, say local governments are stepping into an area in which the private sector and federal government have clearly failed. Two in three American workers are not contributing to a 401(k) or other workplace retirement account. In addition to the five states getting ready to unveil auto-IRA programs, legislators in more than a dozen other states have been pushing similar plans.
Harvey hopes California’s plan will be “a lot easier” than other options, with less-confusing paperwork to fill out, money automatically taken out of her paycheck, and investment options vetted by the state.
https://www.msn.com/en-us/money/savingandinvesting/republicans-take-aim-at-californias-retirement-dream/ar-BByZLf6?li=BBnbfcN&ocid=edgsp
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