|
RETIREMENT SECURITY MATTERS
A forum for retirement innovation information sharing
focused on states, supporters, and service providers.
Vol 77 | May 5, 2023
| | |
Greetings! Lisa, welcome to Retirement Security Matters – where we talk about retirement readiness innovation by states, supporters, and service providers. | |
It’s May, we’re enjoying lighter, longer days. We hope you’re enjoying fresh starts and new adventures. With an iced coffee in hand, let’s catch you up on what is going on in the world of retirement security. You won’t want to miss:
-
Insights from Pewster Kim Olson on state Auto IRAS and fact-based advocacy.
-
Frrresshhhh state metrics
- Key updates from California, Connecticut, Delaware, Maine, Maryland, New Jersey, New York, and Viginia – and a host of legislatively active states
-
Hot Sauce and Cool Stuff - from NAST to “Bert” Hoover
- … and Pix of the week! including the White House, and … brownies
| Comments or content suggestions? We welcome both. Have something about your program you’d like to share? We are all ears. | |
|
RSM wants your support! Be seen.
Click to grab this space for your brand.
| |
Do Rising Tides in Auto IRA States Float All the Boats? Pew Dishes | |
|
If you don’t know Kim Olson, you must get to know her. We met in the Oregon State Treasurer’s office in the early, heady days of 2017 when the OregonSaves program was still a twinkle in the eyes of many and a thorn in the sides of some.
We had a lot of interesting challenges to solve. And who better to tackle them with than a former diplomat turned policy director? No one, that’s who.
In some ways, 2017 feels like a long long time ago. The world has changed mightily, and we’re learning a lot. Here’s some of it.
This is an excerpt. The full piece can be found here.
| |
|
Kim Olson, Senior Officer, Retirement Savings
The Pew Charitable Trusts
| |
|
Kim Olson, we are super excited to have you with us today. Tell us about your role with Pew.
As a policy wonk with on-the-ground experience at OregonSaves, I came to Pew to work directly with states that are implementing Auto IRAs, and to provide expert support to states that are working on statutory changes or working on legislation to create programs in their state.
Pew has been measuring the impact of these programs in states where they are launched. What are you learning.
Yes. One measurement is our analysis of new plan formation – do employers in Auto IRAs start plans, drop plans, or neither, when met with the requirement to facilitate the state’s Auto IRA program if they don’t offer their own plan.
This year’s research is the third iteration of that work. The headline is that we are finding Oregon, Illinois, and California employers with plans continue to offer private plans. And employers without plans are adopting new private plans at rates at or above the national average.
Employers do not appear to be dropping their private plans in favor of the states’ programs. And as opposed to competing with the private market, this data indicates that programs are complementary.
We'd love to hear more.
Digging in: in Oregon, we saw an increase in the share of new plans from 6.7% on average to 8.5%, on average in those years after OregonSaves started operation.
In Illinois, which has historically had plan creation rates below the national average, … [more goodies ahead – keep reading HERE]
We hear anecdotally that some advisors are focusing their sales efforts on Auto IRA states, because the growth rates are faster there. Does that match what you are seeing?
We've heard those reports as well. You had Steve Abbott of Gusto on your program recently sharing their experience – Steve is a former Pewster, by the way. A piece the Wall Street Journal did about our new 5500 research stated more specifically that Gusto’s 401(k) sales in California rose by 35% in the spring of 2022, ahead of the CalSavers June 30 deadline.
Kim, what haven't we asked that's worth spending a minute on?
Let me give a little preview on some research that we have coming. Pew is partnering with eConsult Solutions on a 50-state study of the fiscal impact of insufficient retirement savings. We’re calling it “the cost of doing nothing”. The results will include data for all 50 states that policymakers and stakeholders can use to inform themselves on why programs like these are necessary for the future fiscal health of states and taxpayers.
I can’t say more yet, but the cost of doing nothing is a very big number. Stay tuned.
What a cliffhanger! Watch this space, folks. Kim, thank you for sharing your recent results and for joining us today. We really appreciate it.
Want to know more? Connect with Kim by email and follow the work of the Pew Retirement Savings Project here.
Kim Olson is the Senior Officer on The Pew Charitable Trusts’ Retirement Savings Project. In this role, she provides expertise and technical assistance to state governments studying, legislating, or implementing automated savings programs. Prior to joining Pew, Olson served as policy director to Oregon State Treasurer Tobias Read, where she designed policies, wrote program rules, and advanced legislation to help Oregonians save for the future, most notably through the first automated savings program in the United States, OregonSaves. She also served as a senior adviser at the Behavioral Insights Team, where she used behavioral science concepts to inform policy and improve public services in state and city governments. Olson began her career in the U.S. Foreign Service in diplomatic assignments at the U.S. embassies in Bern, Switzerland, and Ankara, Turkey. She holds a bachelor’s degree from the University of Oregon, a master’s degree from Georgetown University, and lives in Silver Spring, Maryland with her husband, two children, and two rambunctious cats.
| |
*Fresh!* State Auto IRA Program Metrics | |
|
What’s up! April figures are rolling in.
Assets. Saver assets are up 26% year-to-date and 2x since December 2021 to $808 million. CalSavers achieved a new milestone this month, passing the mark of $500,000 million in saver assets. Average account balances across the programs are over $1,200. Longer term balances are higher.
Funded accounts. The four programs shown here now aggregate to over 669,000 funded accounts. For comparison, funded accounts are up 1.6x since December 2021, up about 2.5x since December 2020 and up about 6x since December 2019 – and up in 2023.
Facilitating employers. Over 123,000 employers are now registered to facilitate a state Auto IRA. Of that number, more than 51,000 have begun forwarding payroll contributions for savers. CalSavers is primed for more growth throughout 2023, as enforcement efforts ramp up.
| |
State Facilitated Retirement Programs - Fresh Highlights | |
|
California (workforce 19.2 million) – The biggest Auto IRA program in the country is looking for a new executive director after Katie Selenski, who has led it since its inception, recently stepped down to pursue her next adventure. During her tenure, Selenski brought the program from “bill and board” form to $500 million in assets contributed by over 420,000 new savers in the state. What makes a great Auto IRA program director? Among other things, a passionate interest in savers and program operations and success. Selenski brought that in spades. She leaves in her place an excellent team and a great opportunity for the next fresh set of legs.
Investment News https://www.investmentnews.com/calsavers-on-hunt-for-new-leader-as-executive-director-selenski-departs-236486
Executive Director Job Posting
CalCareers
That’s not the only thing going on in California. The CalSavers Retirement Savings Board is also seeking proposals from qualified firms interested in providing Program Consulting Services. Deadline for Bid Responses is May 25, 2023. You can get your copy of the RFP here.
| |
|
Connecticut (workforce 1.9 million) – The Connecticut Retirement Security Program Advisory Board of Directors met on April 21, 2023. Key items on the agenda included the Chairman’s report on outreach efforts and wave schedules, interstate collaboration, and MyCTSavings extension of employee deadline to August 31, 2023. The agenda also included program updates on regulations, update on the Investment Consultant RFP, announcement that the RFP for the Program Consultant has been awarded to AKF Consulting, program progress on wave 3 as well as marketing and outreach efforts.
During the meeting, the Board discussed and approved investment fund changes recommended by Lockwood Advisors and the Program Design and Investment Subcommittee.
Finally, MyCTSavings welcomes new Board Members Ryan Leichsenring, an appointment of House Majority Leader, and Sean Thomas, an appointment of House Minority Leader.
| |
|
Delaware (workforce 499,000) – The Delaware EARNS Program Board met on April 13, 2023. Key items on the agenda included a market report by AKF Consulting and Board updates. The board discussed program model – standalone or partnership – and the pros and cons of each approach for a Delaware program. The board also directed the Treasurer’s office to conduct due diligence and make recommendations concerning program structure, and added a new member to its Outreach & Engagement Committee.
| |
|
Maine (workforce 674,000) – The Maine Retirement Savings Board met on April 19, 2023. Key items on the agenda included a summary report from Executive Director Beth Bordowitz, quarterly financial review, an introduction of new investment consultant Meketa Investment Group, and a presentation on a program sustainability study by the Pew Charitable Trust. The board has been engaging with a range of states on partnership opportunities. At this meeting the board authorized Bordowitz to pursue a partnership agreement with the state of Colorado, with a related target of having a pilot program in place by the fall of 2024.
Maine has legislation making its way through the process that would extend its target start date from 2023 to 2024. The board is also actively beginning its publicity and outreach activity, developing communication materials and approaches and meeting with stakeholder organizations in the state.
| |
|
Maryland (workforce 3.2 million) – The Maryland$aves Board met on May 1, 2023. The agenda included an update from Executive Director Glenn Simmons on the first six months of the program with more than 1,550 employers registered. About 2,400 savers have accumulated nearly $1 million in savings over the program’s early days. Marketing Director Chris Cullen’s update focused on outreach to both employers and intermediaries (Chambers and payroll providers), accompanied by select TV and radio advertising, social media, and targeted outdoor for cross-cultural engagement. The Audit & Finance Committee has approved an FY24 budget of just under $1.1 million for continuing program operations. And, Maryland $aves welcomes new Deputy Director, Meagan Magagna. *Welcome* from us too, Meagan. You’ve joined a special space. Readers – you can get a copy the board’s presentation here.
| |
|
New Jersey (workforce 4.4 million) – Just under the (RSM) news cutoff for this week - the New Jersey Secure Choice Savings Program met on May 5. It was a quick one, clocking in at just under eleven minutes. NJ is making great progress, however. Executive Director Todd Hassler provided an update on program progress toward launch, requesting the board’s approval of a marketing and communications contract with the successful respondent to RFP, MarketSmith. Hassler also introduced the program’s new Chief of Staff, Yon Brown. Welcome, Yon! It’s a great week for fresh faces into the Auto IRA space. Readers, you can opt in to program updates here.
| |
|
Virginia (workforce 4.3 million) – RetirePath opens statewide in late June 2023. *Very exciting*. More than 8,000 Virginia businesses will receive their first registration notice by July 1, 2023. For employers covered by the program in 2023, the RetirePath registration deadline is February 15, 2024. To encourage early participation, RetirePath is providing recognition to Virginia businesses that register before September 18, 2023. Here’s a good place to stay informed.
| |
|
A C T I V E
Massachusetts (workforce 3.6 million) – The Massachusetts CORE Plan Statutory Committee met on January 9, 2023. As a refresher, this program is a multiple employer plan targeted specifically to non-profits with 20 employees or fewer. The Massachusetts legislature is currently considering legislation that would expand the CORE Plan to all employers in the state and create a separate, mandatory auto-enrollment payroll-deduction IRA program.
Minnesota (workforce 3.1 million) Multiple committees in both the state Senate and House of Representatives considered the Minnesota Secure Choice Retirement Program Act this March. You can see the Senate version at SF413 and the House version at HF782. Status: SF413 awaits action by the Finance Committee. HF782 passed as amended and awaits action by the Finance Committee. This piece by ASPPA gives a bit more color and a great headline.
Missouri (workforce 3 million) -- HB155, the Show-Me MyRetirement Savings Plan proposes a multiple-employer retirement saving plan, established through the office of the State Treasurer. If passed as drafted, the program would have a live date of September 1, 2025. The bill was referred to Financial Oversight. Here’s a great summary from AARP on the impact of building a stronger future for Missouri workers.
Nevada (workforce 1.5 million) reintroduced a bill creating a state-supported retirement plan for workers who do not have access to one at their workplace on March 16, 2023. SB305 would create the Nevada Employee Savings Trust, which would be directed by a board of trustees with the power to establish a retirement savings program and automatically enroll private employees. The program would be targeted to go live July 1, 2025. Here’s a great summary from PlanSponsor on this effort for the third consecutive session.
North Carolina (workforce 5.1 million) introduced HB496 on March 29, 2023. The program, known as the North Carolina Small Business Retirement Savings Program, or North Carolina Work and Save, would offer voluntary enrollment for employers, employees, or self-employed individuals who do not currently offer or have a retirement plan. The program would be targeted to go live July 1, 2025. "An estimated 1.7 million North Carolina working families [...] have no access to an employer-sponsored retirement plan or program or any other easy way to save at work," the bill states. For more see coverage by Pensions & Investments (subscription may be needed to view this piece), PlanSponsor, and ASPPA.
Pennsylvania (workforce 6.2 million) Keystone Saves HB577 was reported out of the House Commerce Committee by a positive vote on May 3, 2023. The legislation was re-introduced by state representatives Kyle Mullens (D-Lackawanna) and Pat Gallagher (D-Philadelphia) and championed by Pennsylvania State Treasurer Stacy Garrity earlier this year. You can learn more about Keystone Saves here.
Puerto Rico (workforce 1.2 million) On February 27, 2023, Puerto Rico enacted
Ley 42 - 2023 (in Spanish) to establish a financial literacy public policy program aimed at increasing financial security and retirement readiness for the territory’s labor force. This would also include the creation of a task force to develop a voluntary retirement savings program for private-sector employees. The task force has a year from the law’s enactment to report its recommendations.
Rhode Island (workforce 577,000) On February 8, 2023, Rhode Island introduced a measure that would establish the Rhode Island Secure Choice Retirement Savings Program. HB5417 and S0089 would create a state-facilitated auto-IRA program for employees of private-sector employers that do not offer a retirement plan. Status: HB5417 awaits action by the House Corporations Committee, and S0089 was withdrawn at the sponsor's request
Tennessee (workforce 3.4 million) Introduced in December and January, HB0013/SB0113, the Tennessee Retirement Savings Plan Act would create a Tennessee retirement savings board empowered to develop an Auto IRA program for the state’s private sector workers whose employers do not offer plans. On the House side, the bill was taken off notice for the Public Service Subcommittee of State Government Committee on March 21, 2023.
Vermont (workforce 336,000) On March 17, 2023, Vermont introduced S0135 to establish a state-facilitated retirement savings program for workers whose employers don’t offer a workplace retirement plan. VT Saves would be structured as an Auto IRA, covering employers with five or more employees and no retirement plan. Employer deadlines range from July 2025 to July 2026. The bill does include enforcement capabilities, including penalties for non-compliant employers. The bill has passed out of the Senate for consideration by the House. See the official statement from State Treasurer Mike Pieciak here and additional coverage by Pensions & Investments (subscription may be needed to view this piece), and AARP Vermont.
Wyoming (workforce 289,000) -- Wyoming's HB0129 - Wyoming Private Employees' Retirement Savings Plan, introduced in January, came out of the Corporations Committee with a do-pass recommendation, but failed to pass the Committee of the Whole.
| |
|
C O M I N G U P
-
Oregon (workforce 2.2 million) – The next meeting of the OregonSaves Board is scheduled for May 17, 2023.
-
Virginia (workforce 4.3 million) – The next meeting of Virginia’s Retirement Program Advisory Committee is tentatively scheduled for May 24, 2022.
-
Maryland (workforce 3.2 million) – The next meeting of the Maryland$aves Board is scheduled for September 11, 2023.
| |
|
Here’s a quick curation of a few things you won’t want to miss this week.
If you’re following the emergency savings space, make a minute for UK Nest’s report: Workplace sidecar saving in action: Learnings from a multi-year, multiemployer UK trial of a new approach to supporting employees with emergency and retirement saving. We’ll give you one little nugget from the report: opt out works better than opt in. But the report is much richer and more detailed than this, and worth your time if you work in the space.
Here’s a supplemental nugget for the US from Sid Pailla at Sunny Day Fund, featuring Erica Hayton of the Cystic Fibrosis Foundation. (Youtube alert!)
Our friends at EBRI have released their 2023 Retirement Confidence Survey. While the headlines on this page are positive – 7 in 10 workers are confident in having enough to retire, and 27% are very confident – the key findings in the report are less so. A couple of highlights include:
- Americans’ optimism that they will have enough money to live comfortably throughout retirement declined over prior periods
- Inflation and market action are causing concerns for workers preparing for retirement
- And for other savers, increases in debt are impeding their ability to save
DCIIA and SPARK are hosting their 2023 Public Policy Forum in Washington DC on June 6-7. We aren’t on the docket, but we will be in the crowd. The agenda is shaping up to be a hot ticket.
NAST is hosting its Treasury Management Training Symposium in our hometown of Portland, Oregon June 12-15. Will we see you there? We’re sharing the stage with Jason Ewas of the Aspen Institute Financial Security Program, Kim Olson of Pew Charitable Trust’s Retirement Saving Project, Jessica Muirhead of MyCTSavings, and Gay Lynn Bath, Director of Retirement Plans Management at University of Oregon. Our focus – The Data is Talking: the Role of States in Retirement Savings Access and Inclusion. #dontmissit
Anddddd … in our ears. -- Hoover: An Extraordinary Life In Extraordinary Times – by Kenneth Whyte, and via Audible. With Hoover, we’re on president #31, and we have to say, this is the first biography we’ve read where there’s pretty much a lack of presidential hero worship. Hoover is a scoundrel. And an organizational genius. Probably one of the more even-handed biographies written! Interestingly we’ve just learned that Hoover wrote his own presidential biography – of Woodrow Wilson. Might have to read that.
Your life would not be complete without a TikTok moment. Here’s today’s one. Have we tried this? No, we have not. But if we seem unusually ocularly focused on you the next time we zoom together, now you’ll know why.
| |
Spring full of fun! Kim, Ellie, Scott and Henry enjoying an aerial forest adventure to Easter egg rolling at the White House. | |
Oh and during work hours, enjoying working with the purrfect co-worker Taffy! Here’s a still life picture Kim has titled, Cat with Mouse. | |
And in Oregon this week, we turned this – into this. So worth it. #yum! If you try it, do go for the extra chocolate chips and plan to share with a large family or your neighbors. These babies are rich. | |
|
That’s it for this edition. ❤️ Hug your people and change the world.
If you like this piece, please stick with us. We’ll be back in about two weeks. If you don’t like it, please unsubscribe below. Comments for us? Please let us know. Want your own subscription? Request one here. All information shared is from public sources or used with express permission.
| |
Massena Associates provides process, policy, and implementation consulting on retirement savings programs and products.
Our clientele includes public entities, policy organizations, and private sector providers. Our specialty – efficient, targeted results. We are an active speaker on retirement security topics, including state-facilitated programs, MEPs and more.
If you’d like to explore working together, we welcome the conversation. Connect with us here, and at 339-236-0684.
| |
|
Looking for a great retirement savings innovation resource? Led by Dr. Alicia Munnell, the Center for Retirement Research at Boston College develops and hosts terrific content and proprietary research related to states, financial security, social security, and more.
The Defined Contribution Institutional Investment Association (DCIIA) is dedicated to enhancing the retirement security of America’s workers. To do this, DCIIA fosters a dialogue among the leaders of the defined contribution community who are passionate about improving defined contribution outcomes. DCIIA's site provides a range of public and member-specific resources.
The Georgetown Center for Retirement Initiatives, Exec Angela Antonelli, provides excellent information on state-based and other retirement security innovation and policy.
Pew’s Retirement Savings Project studies the challenges and opportunities for increasing retirement savings and is another great resource - check out the work of John Scott and his terrific team.
If you want a great source of broad-based, consumer-focused retirement news, Jeffrey H. Snyder’s The Morning Pulse is your ticket. You can subscribe here.
| | | | |
