Auto-Savings Program Could Help Idaho Small-Business Employees
Saving for retirement is a struggle for many Idaho workers right now. A bill in the Idaho Legislature is aimed at making the process easier.
About 375,000 private-sector employees in the state don't have access to a retirement savings plan at work, according to a 2020 AARP survey. Francoise Cleveland, associate state director of advocacy at AARP Idaho, said Americans are 15 times more likely to save for retirement if they can do so at work.
"So what this bill does," she said, "it would create a state-facilitated, auto-IRA retirement system for working Idahoans who do not now have access to a voluntary payroll-deduction retirement plan at work."
The AARP survey found the average retirement savings of Idaho households is only $2,500. For households near retirement, it's about $14,500 on average. Opponents of the idea have said workers can save on their own, so there's no need for a state program, but AARP has said research shows being able to have money deducted from paychecks helps people save more.
Cleveland noted that two-thirds of small businesses in Idaho do not offer a retirement savings plan at work.
"Sometimes it's complicated for them to do it," she said, "but they feel that if they had one, it would help them stay competitive and really help them retain employees within their business."
Cleveland said House Bill 180 would help Idahoans be more self-reliant when they're older.
"Hopefully we can build a culture of savings in our society so that people are comfortable," she said. "They can have a secure retirement, and have a better future for everyone."
Three states have auto-savings programs such as the one Idaho lawmakers are considering, and the people in those programs have accumulated almost $170 million in total.