BILL STATUS UPDATE: Senate Bill 5740 passed the Senate on Friday, March 8 with a bipartisan vote of 31-17. Click here for AARP statement on Senate passage. It passed the House Committee on Consumer Protection and Business on April 2; passed the House Appropriations Committee on April 8; and is now heading to a House floor vote.
For millions of Washingtonians, each passing second means less time to save for retirement. While the clock keeps ticking, they keep struggling to find a way to take control of their financial future. Social Security is just not enough to retire on. So unless we act soon, a secure retirement will be out of their reach.
Almost half of Washington workers – 1.1 million people - do not have access to workplace savings plans. Yet we know that people are 15 times more likely to save if they have can do so right out of their regular paycheck at work.
That is why AARP and small business owners across Washington State support SB 5740, the Secure Choice Retirement Savings Program. The self-sustaining, participant-funded 401(k) style program will allow workers to:
- Make saving easy. The program automatically makes contributions to employee savings accounts through payroll deductions and allows them to keep their account as they progress from job to job.
- Put their money to work. Money saved is money earned. Automatic enrollment simplifies the process of saving for retirement by transforming a confusing process - whether to save, how much to save, and how to invest into a simple choice.
- Keep them in control. The Auto-IRA program is completely voluntary so employees can opt out at any time. The program gives workers complete control over their own retirement savings account, putting them in the driver's seat.
Without their own retirement savings, many Washingtonians will have to rely solely on Social Security for their retirement and with an average annual benefit of $18,000, it's just not enough. In fact, half of all households are at risk of not being able to handle everyday expenses – like medicine, utilities and rent – in retirement. Secure Choice will also help the next generation – our kids and grandkids – save for retirement, by making it easy to start investing in their futures.
Helping Small Businesses
Secure Choice will make small businesses more competitive by giving them an easy way to offer a savings option. No HR department needed. No shopping for a product. No need to prepare guidance or education for employees. No operational or regulatory burden. The Secure Choice program facilitates all of those tasks. That’s why the program is supported by small business owners across the state, including the Washington Hospitality Association.
"This bill will allow more people to save for retirement and be prepared for the future," says Travis Rosenthal, owner of Tango, Rumba and Sand Point Grill in Seattle and member of the Washington Hospitality Association. "I testified in support of this bill in committee and am happy to see it pass in the Senate. Like many other small business owners, I am invested in my employees' success and that includes finding ways to help them save for retirement,” said Rosenthal.
“Like many other small business owners, I am invested in my employees' long-term success which includes vehicles like retirement that positively impact financial health,” says Brian Moreno, owner of McDonald's in central Washington and a member of the Washington Hospitality Association. “Our businesses are complex, and in many cases, it is burdensome to set up and manage a retirement plan on your own. The Secure Choice Savings Program will be a game changer by helping more small businesses offer workers a way to plan for their future,” said Moreno.
It’s time to make saving for the future easier on everyone and ensure that everyone can have a chance to grow the savings they need to have a more secure future.
AARP is urging the legislature to pass the Secure Choice Retirement Savings Program. It's fair. It's right. It's time.