A Push to Boost Retirement Savings

As executive director of a small Macon arts organization, Julie Wilkerson, 62, would like to offer a retirement savings plan to her three employees. But administrative and other costs make doing so out of reach for her nonprofit.

That could change if the Georgia General Assembly passes legislation to create a state-facilitated retirement savings program for private-sector workers who don’t have access to one through their employer. AARP Georgia will be pushing for such a “work-and-save” bill during the 2025-26 legislative session, which begins in January.

The measure—to be introduced by state Sen. Chuck Hufstetler (R-Rome)—would pave the way for workers at participating businesses to open a retirement account, typically a Roth IRA, and fund it through automatic payroll deductions.

“It would definitely be an asset,” says Wilkerson, who leads the Macon Arts Alliance, which serves Middle Georgia. She says putting money aside for retirement is especially important now that people are living longer.

“Outliving your money is a real thing,” she says. Many younger workers worry about Social Security’s long-term viability, she adds.

More than half of Georgia’s private sector workers—about 2.1 million residents—are employed by companies that don’t offer a traditional pension, 401(k) or other retirement savings plan, according to a 2022 AARP report.

A national push

AARP has urged state legislatures across the country to create state-facilitated retirement savings programs, with a preference toward automatic workplace enrollment. As of July 1, 2024, 17 states already offer or have approved automatic IRA programs, and another three have enacted voluntary work-and-save programs, according to the Georgetown University Center for Retirement Initiatives.

It’s part of an effort to address a looming retirement crisis. One in 5 Americans age 50 and older have no retirement savings, while more than half worry they won’t have enough money to last through their retirement, according to a 2024 AARP survey.

Too many businesses in Georgia don’t have “an easy, efficient and low-cost way” to help their employees save, says Hufstetler. He wants Georgia workers to have the same opportunities to save as those in other states with work-and-save programs.

Hufstetler sponsored legislation in the 2023-2024 session to create a work-and save program but it did not get a hearing or a vote. Myrtle Habersham, AARP Georgia’s volunteer state president, is optimistic that the new session will give advocates time to educate lawmakers and the business community about the benefits of such a program.

Employers care about their employees and want to do what’s best for them, says Habersham, a retired federal official who has a consulting firm that advises small businesses. Offering a retirement plan would also help businesses attract and retain workers, she says.

“Many young people who are looking for jobs want to know about benefits,” she says.

Hufstetler had not finalized his proposal as of press time, but it’s expected to allow workers to control how much they contribute and to opt out at any time. Businesses would not incur costs for the program; they would just enroll their workers and facilitate payroll deductions.

A bipartisan Georgia Senate committee, created in 2021 to study ways to boost retirement security, recommended implementing such a program. An August 2024 AARP survey of 1,254 likely voters in Georgia found that 81 percent support creating a retirement savings program for private-sector workers who do not have one through their jobs.

Chaney McDonnell, 45, of Augusta, owns a couple of small businesses, including a construction company. He would like a retirement plan for his employees—and himself—because he knows it will be difficult for them to keep up with the physical demands of construction work as they age.

If there was an easy savings option, “it would guide a lot of people in the right direction,” says McDonnell. ■

Ann Hardie spent a decade covering aging issues for The Atlanta Journal-Constitution. She has written for the Bulletin for 15 years.

Also of interest:

• My Biggest Retirement Mistake: Not Retiring Sooner
• 5 Retirement Fears and How to Conquer Them
• 5 Features to Help You Make the Most Out of Your 401(k)