During our 2016 IABG Partner Convening last October, we had the opportunity to hear from staff at...Read more
About this Policy
All people deserve the right to retire with dignity. Unfortunately, our national retirement savings crisis has left seniors with insufficient savings to meet their basic needs. As more and more businesses fail to offer a retirement savings option for their employees, this trend will only get worse.
IABG led the campaign to address this crisis in Illinois. After more than 5 years of advocacy, in 2015 Illinois became the first state to enact legislation — the Illinois Secure Choice Savings Program — that will automatically enroll private-sector workers without access to an employment-based retirement plan into such a savings program.
Retirement Insecurity in Illinois
Over 2.5 million workers in Illinois lack access to an employment-based retirement plan. That means that over half of the private sector workforce is expected to retire on Social Security alone, along with any savings they are able to accumulate without the benefit of a payroll deduction at work, because their employers don’t provide access to pensions, 401(k)s or IRAs. This problem is not concentrated in one part of Illinois but is spread throughout the state, affecting at least 50% of private sector workers in every legislative district. This inability to easily save for retirement through work is contributing to increased retirement insecurity and an over-reliance on Social Security. Learn more.
Illinois workers need access to easy and convenient tools to build retirement savings. Without them, more people will experience a drastically reduced quality of life in retirement. Many will fall into poverty, creating an increased burden on families, communities, and the state.
Victory: Illinois Secure Choice
What is the Illinois Secure Choice Savings Program?
Secure Choice is a new program that will be available to Illinois workers as early as the fall of 2017. It is one way to help private sector workers save their own money for retirement.
Am I eligible to participate in Secure Choice?
If you work at an employer that has been operating for at least 2 years, employs 25 or more workers a year, and doesn’t already offer you a retirement savings option, then you are eligible to participate in the program. If you fall outside of this description, you may be able to participate another way. There should be more information on that shortly.
How does Secure Choice work?
Workers are automatically enrolled in the program, but can choose not to participate. Workers that don’t opt-out can choose to save a portion of their paycheck into a Roth IRA through automatic deductions from their paycheck. During enrollment, workers may choose an account type and determine their level of contribution. For the worker who chooses the default option, she or he will contribute 3% of every paycheck to a target date life-cycle fund. A worker can change her or his investment amount and type.
The Illinois State Treasurer will administer the Illinois Secure Choice Program on behalf of the Secure Choice Board. The Board is currently in the early stages of program implementation. IABG is advocating for proper implementation of the program. Our focus is ensuring that the program design takes into account the unique needs of low-income workers.
Content related to this policy
IABG submitted the following comment letter on behalf of our partners to the Deparment of Labor in...Read more
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