Connecticut today announced the launch of a new private-sector retirement savings program aimed at the state’s more than 600,000 workers who aren’t offered a retirement plan by their employer.
State Comptroller Natalie Braswell on Thursday rolled out the new program, called MyCTSavings.
“The MyCTSavings program creates new opportunities for workers to plan for their futures and fills a critical need in the marketplace. The plan is designed to be easy for employers to maintain and is optional for workers to participate,” Braswell said in a statement.
“This program provides an option for workers who don’t currently have the opportunity through their employer to save for retirement and make smart investments in their futures,” said Governor Ned Lamont. “Expanding opportunities like this not only helps workers themselves, but it also supports small businesses in their efforts to attract employees.”
In early April, letters will be sent to approximately 30,000 Connecticut employers informing them of the MyCTSavings program, and the requirements to participate. Employers are required to register if they have more than five employees and do not currently offer a qualified retirement savings option. Participation for employees is voluntary—they can choose to remain enrolled or opt out and then re-enroll later. The regular contributions to a Roth IRA help save for retirement and the account is portable; if a participant changes jobs, their account follows them.
“I have long championed legislation to provide private sector workers with a secure retirement option,” said Senate President Pro Tempore Martin M. Looney. “Far too many of our senior citizens rely solely on Social Security for retirement income. While Social Security has lifted generations of seniors out of poverty, that income alone is often not sufficient to provide for a decent living.”
MyCTSavings is designed to be easy and flexible for both the employer and employee. Employer registration is quick, and the program seamlessly integrates into any payroll process. A pilot program began in October 2021, enrolling several employers to test processes and gain feedback. Participants have found it easy to enroll and maintain, and are already seeing the benefits for their workers.
“As a small company, it can be hard to compete with benefits packages at large corporations,” said Axel Collazo, Assistant Manager of Ace Transportation of Tolland. “It was easy to enroll and our employees who chose to participate are already excited about the opportunity to start saving for retirement.”
“I investigated 401k retirement plans for our staff in the past, but they were always too expensive for our company,” said John Miller, owner of National Chromium in Putnam. “This program is very easy to administer, charges no fees and literally takes me five minutes a week to enter the weekly payroll deductions for our employees that opted to participate.”
“We are pleased that the MyCTSavings program is launching and will provide a more secure retirement for the over 600,000 workers who do not currently have a payroll deduction retirement savings program”
Nora Duncan, AARP Connecticut
Businesses statewide are now able offer the program to their employees at a crucial time when 51% of Americans have increased concern about their retirement due to the COVID-19 pandemic (according to a report from the National Institute on Retirement Security).
“We are pleased that the MyCTSavings program is launching and will provide a more secure retirement for the over 600,000 workers who do not currently have a payroll deduction retirement savings program,” said Nora Duncan, State Director of AARP Connecticut. “Employees are 15 times more likely to save for retirement when offered an auto-deduction opportunity. This program is a win, win, win. It will help employers provide a no-cost benefit to their employees. It will provide employees with a more secure retirement. And it will benefit all Connecticut taxpayers by reducing the need for social safety net programs in the future.”
The program is sponsored by the Connecticut Retirement Security Authority, of which Comptroller Braswell serves as Chair. The Board selected Vestwell as the program’s third-party administrator after a competitive bidding process.
Comptroller Braswell acknowledged the contributions of the Board, former Comptroller Kevin Lembo, Governor Lamont, AARP and staff of the comptroller’s office for their work in bringing the program to launch.
SEE ALSO:
• New Jersey Auto-IRA Program Kicks Off March 28
• What Mandatory Auto-Enrollment IRAs Actually Mean
• Most Americans Strongly Support State-Run Retirement Programs
• Colorado, New Mexico First to Partner on State-Run IRA Program
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.
