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State Automated Savings Programs

Tens of millions of Americans don’t have access to workplace retirement benefits, threatening their future financial security and burdening state budgets. In the last decade more than a dozen states and cities passed legislation establishing automated savings programs designed to help workers save for retirement. Also known as auto-IRAs, work and save, and secure choice, these programs allow small businesses to recruit and retain workers by offering a no-cost retirement benefit. And when workers are more financially secure, they are less reliant on taxpayer-funded government programs, better able to withstand financial shocks, and more likely to save for their future.

The Pew Charitable Trusts’ retirement savings project provides data, analysis, and technical assistance to help states design automated savings programs to best fit the needs of employers, workers, and taxpayers.

No Retirement Plan at Work? An Automated Savings Program Can Fix That

Benefits for Small Businesses

Many small businesses are unable to offer retirement benefits because of high startup costs and lack of administrative capacity. Automated savings programs are a no-cost and user-friendly retirement benefit for small businesses.

Savings Access for Private Sector Workers

Research shows that workers are 15 times more likely to save for retirement if they can use payroll deduction. Yet tens of millions of Americans—nearly half of private sector workers—don’t have access to retirement savings at work.

Fiscal Impact of Barriers to Savings

States across the country are dealing with multiple budgeting challenges. Insufficient retirement savings will increase pressure on public assistance programs, reduce tax revenue, and decrease household spending by retirees while shifting the growing fiscal burden to a shrinking population of working-age taxpayers.