By Evelyn Liebman, AARP New Jersey Advocacy Director
On March 28th, Governor Murphy took a monumental step in ensuring a more secure financial future for hardworking New Jerseyans – a single step that was years in the making. With the signing of the bi-partisan new Jersey Secure Choice Savings Program Act, Governor Murphy gave new life to an initiative that had been gutted and left to die on the vine in the previous administration.
There is broad agreement NJ’s retirement security crisis is real. The facts are the facts. Currently, the average near-retirement worker has only $14,500 saved for retirement. The average annual Social Security payment for Garden State retirees is $19,000 and nearly 1 in 4 older New Jerseyans rely on Social Security for 90% or more of their income. Social Security was never intended to be a person’s sole source of income in retirement.
So the question then becomes “Why don’t people save more?” If only it were that simple. The answer is lack of access.
Right now, a whopping 53% of the private sector workforce in New Jersey doesn’t have access to a retirement savings option at work. Fewer than 5% of workers will set up an IRA or other retirement savings plan when left to their own devices, but 71% will participate in a plan when it’s offered at work.
So the more important question is “How do we create more access for people to save?”
The answer is Secure Choice, a simple, easy to use program that addresses our retirement savings crisis head on.
Secure Choice creates a public-private partnership that will provide a workplace retirement savings option for 1.7 million private sector workers in New Jersey who don’t currently have access to a retirement savings option at work – a reality that disproportionately impacts women and minority workers. It is commonsense, bipartisan legislation and creates a program that is voluntary and a retirement account that is portable. Moreover, the professionally-managed program comes with no ongoing costs or risks to taxpayers or employers.
Lack of access? Not anymore.
Secure Choice has now passed twice with bipartisan support in the New Jersey legislature – and thanks to the dogged determination of advocates across the state working with legislative champions, this time it’s for real. We now have an opportunity to change the sobering facts and give Garden State residents the tools they need to start saving now – and avoid a crisis later. That’s a win for the future of New Jersey.
AARP applauds Governor Murphy and the New Jersey legislature for giving workers in our state the opportunity to take control of their financial futures. Dead on the vine no more, the Secure Choice Savings Program Act will change the retirement savings landscape in New Jersey for the better.