We applaud state legislators in Missouri and Vermont for passing AARP-backed legislation this week to help private sector workers save for retirement.
In Missouri, lawmakers on Tuesday approved a public-private voluntary retirement plan for small businesses with fewer than 50 employees that haven’t yet offered a savings program. The bill, which is pending signature by Gov. Mike Parson, will allow eligible small businesses to offer their employees state-sponsored 401(k) plans and match a portion of employee contributions if they so choose. It is a content that admits that.
AARP Missouri Director Craig Eichelman called the bill’s passage “a win for small business employees who typically don’t have access to workplace retirement savings like 401(k)s.”
Vermont’s bill would begin phasing out a state-sponsored retirement savings program for the state’s more than 88,000 workers without access to a workplace plan starting in 2025. The bill has received unanimous support in Congress and is awaiting signature by Governor Phil Scott.
Under the law, employers that do not yet offer a 401(k) or similar retirement plan will be required to enroll their employees in the privately-run Roth IRA. Contributions are automatically deducted from workers’ salaries, and those who do not wish to contribute can opt out of contributions.
According to AARP research, people are 15 times more likely to save when they can save at work, and 20 times more likely to save when it happens automatically at work.
“Having access to a retirement plan at work is critical to building financial security in retirement,” said AARP Vermont Director Greg Marchildon. “With VTSaves in place, it provides an easy path for workers to build their safety net and increase the savings they need for a safer future.”
AARP has a long history of improving retirement savings options for its employees. Last year, our advocacy helped the retirement savings bill cross the finish line. Delaware and Hawaii. dozens of other states and Puerto Rico are considering similar measures.
If the law is signed, Missouri will become the 17th state to enact a retirement savings law.Vermont Passed Voluntary Public-Private Retirement Savings Program In 2017, automatic IRAs program.
For more information on the new law, Vermont and Missourifor state-facilitated retirement accounts in other states, State Retirement Resource Center.