• AARP, Senate President, Speaker of the House & Comptroller Discuss Implementation
AARP Connecticut, Speaker of the House Joe Aresimowicz, Comptroller Kevin Lembo and Senate President Pro Tempore Martin Looney joined at Connecticut’s Legislative Office Building in Hartford on Thursday, Aug. 17, to applaud that Connecticut is moving forward with the implementation of the Connecticut Retirement Security Program (Public Act 16-29) that was signed into law by Governor Malloy in 2016 and is scheduled to begin operation in 2018.
The new law, championed by Speaker Joe Aresimowicz and Senate President Martin Looney, formed the quasi-public/private Connecticut Retirement Security Authority starting on January 1, 2017. The 15-person Connecticut Retirement Security Authority responsible for oversight of the retirement program held their first meeting on Thursday, Aug. 17, at 2 p.m.
The plan will require all Connecticut businesses of five or more employees with no pension or 401K plan option to participate in the retirement security program. It will be voluntary for employees, who will be automatically enrolled but have the ability to opt out, and employers will not be required to match contributions.
The new law was the product of the Connecticut Retirement Security Board (CRSB), co-chaired by Lembo and State Treasurer Denise L. Nappier, which was charged with providing recommendations about the efficacy of a workplace savings plan for workers in the state without access to such a program.
“AARP is glad Connecticut is joining other states, such as Oregon and Maryland, to provide opportunities for people to save for retirement at work,” said John Erlingheuser, AARP Connecticut director of advocacy. “Connecticut’s leadership role in providing 600,000 people without a workplace retirement savings plan an opportunity to build a secure financial future will help cut into the huge gap between what exists for retirement and what is needed, as well as reduce the reliance on state-funded social safety net services in the future.”
A recent AARP Public Policy Institute report found Connecticut would save more than $90 million on public assistance programs between 2018-2032 if lower-income retirees save enough to increase their retirement income by only $1,000 a year.
Comptroller Kevin Lembo said, “There is an entire generation of workers, many of them lifelong hardworking middle class people, headed to retirement financially unequipped, in part due to lack of access to a workplace-based retirement savings option. This is not just a serious issue for individuals and families who are financially forced to delay retirement indefinitely, but for our entire state and national economy. I’m grateful that Connecticut is among the leading states to responsibly recognize and act to protect the interests of working families.”
Speaker of the House Joe Aresimowicz (D-Berlin/Southington) added, “I’m very glad to see the Connecticut Retirement Security Authority begin the process of implementing the retirement security program. We’ve worked very hard over the past few years to get to this point, and these authority meetings are the final step to making sure that our hard working residents are given the tools they need to save for the comfortable retirement they have earned.”
There is a $7 trillion retirement savings deficit among older Americans in the United States, according to data from The Center for Retirement Research at Boston College. Further, AARP Public Policy Institute studies show that people are 15 times more likely to save for retirement if they can do so through a payroll deduction program at work.