A steady rise in states considering guaranteed workplace retirement savings laws has revived a debate over the potential for federal government intervention in covering American workers whose employers don’t already offer 401(k)s.
North Carolina became the latest state last month to introduce a bill (H.B. 496) that would establish a savings tool akin to an automatic individual retirement account for private-sector workers. Nationwide, 16 states and two cities have passed state-sponsored retirement savings plans, according to the Georgetown University Center for Retirement Initiatives.
A bipartisan group of lawmakers on Capitol Hill, meanwhile, are preparing to re-introduce legislation that could skirt private-sector and state-run programs by setting up a federal government-sponsored auto-IRA that matches worker contributions with Treasury-backed funds. Growing Republican support for the bill makes passage this session a real possibility, proponents say.
Nearly half of working-age adults in the US—57 million Americans—don’t have access to retirement savings benefits at work, according to AARP. Since workplace retirement savings are widely considered the most effective way of generating livable retirement income, federal and state social safety nets could be overrun by a future influx of retirees.
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