Oregon is enrolling employees in a very similar retirement plan to the one we've been advocating for here in Colorado. The OregonSaves retirement savings plan is for private sector workers without a plan through their employers, like the Secure Savings Plan (HB17-1290) the Bell and other allies proposed during the 2017 legislative session. The plan is also supported by small businesses unable to otherwise provide retirement plans.
As for the logistics: Workers are automatically enrolled in the plan at 5 percent of their salary with the option to drop out or contribute a different amount. They can also increase their savings rate by 1 percent each year up to a maximum of 10 percent.
Oregon began to enroll workers in their plan this summer as a pilot with over 50 employers and 1,150 workers participating, resulting in workers saving about $255,000 in total to date.
Having enough money in retirement is one of American’s top financial worries. We are living longer and many people are afraid they will run out of money in retirement. Just over half of all families nationally had any retirement savings in 2016, having saved $60,000 on average. The best way to save is to put aside a little out of each paycheck into a low-cost retirement plan. Unfortunately, many Americans, including about half of all Coloradans in their prime working years, about 755,000 workers, have no retirement savings plan at work.
The owner of Portland's Annastasia Salon, Luke Huffstutter, says, “I had looked into setting up an employee savings plan. We met with four different companies, but the plans were either too expensive or the fees were too high.” Huffstutter signed up for OregonSaves right away.
The salon’s manager Maria Isaac says she was surprised at how easy it is to start saving. “Having a program like OregonSaves is helpful for me as a young professional in an industry that retirement plans aren't very common,” she says. “Knowing I am starting my retirement is a great feeling, it helps me make sure I'm planning for my future.”
A poll conducted for AARP shows 79 percent of Oregonians support the OregonSaves plan, 52 percent strongly. Of those eligible, 64 percent are interested in participating and 78 percent would recommend it to a family member or friend.
Beginning in January, the plan will be rolled out to all Oregon employers with 100 and more workers. By May, employers with 50 to 99 more workers will enroll employees. Employers with 20-49 workers will be brought in by December, and then all employers will be participating by 2019.
As Oregon leads the way, Colorado should take note: Our state's retirement crisis is a problem we can solve if we work together to find solutions.