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RETIREMENT SECURITY MATTERS
A forum for retirement innovation information sharing
focused on states, supporters, and service providers.
Vol 84 | September 7, 2023
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Greetings! Lisa, welcome to Retirement Security Matters – where we talk about retirement readiness innovation by states, supporters, and service providers. | |
Can you believe it? As we say farewell to August, September has blasted in. This week RSM is dropping the summer s-t-r-e-t-c-h and resuming its bi-weekly schedule. Stop thinking about baseball, or your kids, grab a refreshing beverage, and get ready to ease into fall with some content to make you smarter, better, and faster. We said it.
- Fall Season - Getting Ready for 2024! And tips for the rest of 2023
- Frrreshhh state metrics vs. the much anticipated $1 billion in assets milestone
- Updates from California, Colorado + Maine, Illinois and Massachusetts
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Best Practices: We go blue.
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Hot Sauce! and some cooool stuff
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… PIC of the Week! Just one.
| Comments or content suggestions? We welcome both. Have something about your program you’d like to share? We are all ears. | |
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RSM wants your support! Be seen.
Click to grab this space for your brand.
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Fall Season: Getting Ready for 2024 | | |
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Yes, you’re looking at the last iced coffee of summer.
Wherever you are, we hope you’ve enjoyed many adventures far, wide, and near.
As your kids get off to school and your adult kids turn their attention to work, you too may appreciate some fresh fall thinking.
Enjoy this summary of the sequel to our Summer Season piece. You’ll find the long form here.
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A last iced coffee at the beach. | |
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We gave you a lot to think about in our last edition – with focus areas ranging across the spaces of legislative advocacy, financial expertise, and tech innovation. And we promised you a little bit more.
With the nip of fall in the air, we are looking forward. It’s conference season, so we’ll see you out and about. And as you are sharing social moments with colleagues, thinking creatively about the future, we’ve got you covered.
Whichever seat you occupy, we’ve compiled a view of some of the things you can be considering, connected to your role in expanding retirement savings access and use this fall and into 2024. Here are three more good ideas to get you going.
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Collaborate with Employers: | |
- This might be your main line of business – you might think of it as sales. Really, you’re increasing access to retirement savings by offering terrific services to employers who need your expertise.
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Bone up on tax credits – from the IRS to you: Eligible employers (100 or fewer employees) may be able to claim a tax credit of up to $5,000, for three years, for the ordinary and necessary costs of starting a SEP, SIMPLE IRA or qualified plan (like a 401(k) plan). That’s nothing to sneeze at, and probably covers the cost of what you offer.
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Diversify our Beloved Financial Services Industry: | |
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Speaking of great materials … if you want to reach me, talk to me in a way that resonates – that shows you’ve walked in my shoes and you’re a good guide. We like the approach taken at OfColor, led by CEO Yemi Rose. And you can think about how these ideas work in all of our communication – it’s time to lighten up on the stiff stuff and get in our users’ walks of life.
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We’ll be better and stronger together when we more completely represent all of the communities we serve. In a time of headwinds, it’s even more important to promote diversity within our industry. We’re doing better, but we’re not all the way there yet. We like industry-wide recognition events like the Diversity, Equity and Inclusion Awards program at DCIIA. And guess what – your next hire or promotion is right here. And here. And here.
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Research and Data Analysis: | |
- Do you like data? From your seat conduct and support research to understand the barriers to retirement savings in different communities and develop targeted strategies to overcome them. Here’s some of the recent work we like – let’s keep building on it:
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- Data like this helps to identify trends and gaps in retirement savings – with roots in access, income, financial expertise, and more. In 2024 let’s use this information to inform policy and program development.
- And, it’s not all bad news – our system is a good one that works well for many. With data, we can make it work much more effectively for many more.
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We’ve got more great ideas, but this, and these, have probably given you plenty to think about.
You’re an important part of future solutions. Grab one last sip of that iced coffee and get out there and make things happen.
Retirement Security Matters..
Lisa
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*Fresh!* State Auto IRA Program Metrics | |
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What’s up! This chart reflects Auto IRA program data as of July 31, 2023, for six of the seven funded programs - excluding Virginia, where data is not yet available.
Assets. Saver assets are up 53% year-to-date and 2.4x since December 2021 to $978 million. Average account balances across the programs are over $1,300. Longer term balances are higher.
Note: RSM metrics focus on the Auto IRA states.
We’re still shy of $1 billion by a small amount, based on this measure.
Funded accounts. The six programs shown here now aggregate to over 733,000 funded accounts. For comparison, funded accounts are up 1.7x since December 2021, up about 2.8x since December 2020 and up about 6.7x since December 2019 – and up in 2023.
Facilitating employers. Over 172,000 employers are now registered to facilitate a state Auto IRA. Of that number, more than 58,000 have begun forwarding payroll contributions for savers.
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State Facilitated Retirement Programs - Fresh Highlights | |
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California (workforce 19.2 million) – The CalSavers Retirement Savings Board met on August 21, 2023. The agenda included updates on the program’s staff organizational chart, program participation, funding as of July 31, 2023, and employer compliance enforcement. The board also heard from program administrator Ascensus and received an investment performance report for the quarter ending June 30, 2023, by Meketa Investment Group. Gilbert CPAs presented their audit report for the Trust’s Administrative Fund for the fiscal year ending June 30, 2022.
At the meeting, the Board considered an RFP for investment consultant services, which was subsequently released. Staff will present the finalists for a resulting contract for the Board’s consideration at the November 13, 2023, Board Meeting.
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Colorado
(workforce 3.2 million)
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Maine
(workforce 674,000)
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Colorado and Maine have joined together in what is expected to be the first live Auto IRA partnership. It is expected that the Maine Retirement Investment Trust (MERIT) and the Colorado SecureSavings program will operate independently in-state but share services and a retirement savings platform under Colorado’s agreements with its providers.
MERIT, passed into law in June 2022, enables automatic enrollment in a payroll deduction Roth IRA for covered employees of employers with five or more employees who do not offer a retirement plan. Colorado's SecureSavings program, authorized in July 2020, operates with very similar requirements and standards. The collaboration aims to make retirement savings more accessible to citizens across state lines, and Vestwell, in partnership with BNY Mellon, will be the program administrator for this multi-state venture.
This cooperative approach builds on Colorado's prior partnership work with New Mexico, demonstrating the potential for cost-effective, state-facilitated retirement savings in both large and small states. Be sure to dive into the press release, chock full of great quotes. Want more? check out NAPA’s recent piece.
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MORE on Maine… The Maine Retirement Savings Board has proposed rules that clarify how the program will work in-state. Key points include:
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Registration: Employers must either join the Maine Retirement Savings Program or adopt a specified tax-favored retirement plan by specific registration dates based on their employee count. Fines apply for non-compliance.
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Onboarding: Covered employers and employees have specific requirements for providing information and registering with the program, with self-employed individuals and voluntary participants also having options to onboard.
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Restrictions: Some restrictions apply, including certain business entities being ineligible to register or onboard employees. Participating employers are limited in their involvement in employee decisions and contributions.
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Opting Out: Covered employees have the right to opt out of participating in the program, with provisions for rejoining if they choose to participate later.
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Public Feedback: The Maine Retirement Savings Board is accepting public comments on the proposed rule until October 2, 2023, and will hold a public hearing on September 20, 2023. Don’t miss NAPA’s other piece.
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Illinois (workforce 6.4 million) - The Illinois Secure Choice Board met on August 17, 2023. The agenda covered critical topics such as program implementation updates, enforcement, legislative changes, and a budget report. Additionally, there was a thorough conversation about the Secure Choice Quarterly report, focusing on outreach/marketing and investment review.
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Massachusetts (workforce 3.6 million) – The Massachusetts CORE Plan Statutory Committee met on August 28, 2023. As a refresher, this program is a multiple employer plan targeted specifically to non-profits with 20 employees or fewer. The agenda included a Q2 2023 CORE investment review from Aon Investments, and a broader program update from Empower Retirement that included social media marketing and outreach strategy development.
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C O M I N G U P
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Maryland (workforce 3.2 million) – The next meeting of the Maryland$aves Board is scheduled for September 11, 2023.
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Oregon (workforce 2.2 million) – The next meeting of the OregonSaves Board is tentatively scheduled for November 14, 2023.
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Massachusetts (workforce 3.6 million) - The next meeting is tentatively scheduled for December 11, 2023.
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This week we’re taking inspiration from the Stanford Longevity Center’s Book Club featuring author Dan Buettner of Blue Zones fame.
This is not strictly a retirement security topic, but the two are closely related. The September 6 event, co-hosted by Martha Deevy, featured a lot of great information - including how (and why) early blue zones are evolving – and where new blue zones are emerging. Hint: communities and leadership can take policy steps that support automatic, healthier choices.
We grabbed a few nuggets for you:
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Care. “Keep aging parents nearby” rather than in care homes, when possible. Is this controversial? We don’t know. “People spend time focusing on the best care facilities with the best features … the truth is that there is a positive ‘grandparent effect’ on the whole family … and when people lose their sense of purpose, they die quickly.”
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Lifelong learning. How does it fit in? “We notice there are 20x more poets among male centenarians than in the population as a whole – they’re keeping their brains engaged.” With women - “there’s almost always a craft or a cause that’s keeping them engaged.”
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Walkable cities. Offer “higher economic viability” and increase community interaction, including especially by and for seniors.
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Why aren’t more people ‘Just doing it’. We know a lot about the factors driving longevity: a healthy diet, a moderately active lifestyle, a sense of purpose, friendship and community. So why are so many of us falling short in one or more areas. “We’ve got to make the healthier choices unconscious,” Buettner says, “by working together to tune our environments and the way we are living.” We’ll call this ‘automatic.’ And we like things that systematically move us to a better outcome.
This is not an ad, but we also grabbed Buettner’s latest book. For a friend.
Will these ideas help us retire better? We think they will.
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Things we’re keeping an eye on, just for you.
It’s conference season - check out the upcoming events from some of our favorite retirement security leaders, including: DCIIA, EBRI, Georgetown CRI, and NAST, to name a few.
And here’s a special one coming up in DC next week - September 13. We ❤️ new things. The first ever Harkin Retirement Security Symposium focuses on "Preserving and Enhancing Social Security for All" - convening policy makers and researchers actively working on Social Security reform research and legislation. And perhaps you.
Just passed - bookmark for next year: Boston College Center for Retirement Research’s RDRC meeting.
Discover how the Illinois Secure Choice Program is reshaping the retirement landscape, bridging the gap for Americans without workplace access to retirement savings. RAND Corporation's surveys for The Pew Charitable Trusts unveil the program's remarkable success, bringing traditionally underserved groups into the fold and empowering them to secure their financial futures, ultimately rewriting the narrative of retirement savings accessibility in America.
And a last burst of inspiration.
You know we are all about the beverages here, including our favorite, ☕coffee. It’s hard to believe, but this fall we’ll all be celebrating the news that Starbucks' Pumpkin Spice Latte just hit the big 20! So, while we may not all be breaking out the sweaters just yet, we can at least enjoy a sip of that spicy nostalgia. (We are actually wearing a sweater as we write this, BTW).
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Are you sad that summer is over and wondering what delights fall has in store for you? Us too, friend. Us too. | |
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That’s it for this edition. ❤️ Hug your people and change the world.
If you like this piece, please stick with us. We’ll be back in about two weeks. If you don’t like it, please unsubscribe below. Comments for us? Please let us know. Want your own subscription? Request one here. All information shared is from public sources or used with express permission.
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Massena Associates provides process, policy, and implementation consulting on retirement savings programs and products.
Our clientele includes public entities, policy organizations, and private sector providers. Our specialty – efficient, targeted results. We are an active speaker on retirement security topics, including state-facilitated programs, MEPs and more.
If you’d like to explore working together, we welcome the conversation. Connect with us here, and at 339-236-0684.
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Looking for a great retirement savings innovation resource? Led by Dr. Alicia Munnell, the Center for Retirement Research at Boston College develops and hosts terrific content and proprietary research related to states, financial security, social security, and more.
The Defined Contribution Institutional Investment Association (DCIIA) is dedicated to enhancing the retirement security of America’s workers. To do this, DCIIA fosters a dialogue among the leaders of the defined contribution community who are passionate about improving defined contribution outcomes. DCIIA's site provides a range of public and member-specific resources.
The Georgetown Center for Retirement Initiatives, Exec Angela Antonelli, provides excellent information on state-based and other retirement security innovation and policy.
Pew’s Retirement Savings Project studies the challenges and opportunities for increasing retirement savings and is another great resource - check out the work of John Scott and his terrific team.
If you want a great source of broad-based, consumer-focused retirement news, Jeffrey H. Snyder’s The Morning Pulse is your ticket. You can subscribe here.
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