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Illinois citizens without access to workplace-based retirement plans will get a new retirement savings option under a new law sponsored by state Sen. Daniel Biss (D-Evanston) that was signed today by Gov. Pat Quinn.

The law, which establishes the Illinois Secure Choice Savings Program, seeks to head off an impending crisis for the 2.5 million Illinois workers who lack access to employer-based retirement plans.

It will make Illinois the first state in the union to have a law on the books automatically enrolling such workers into a retirement savings plan.

“More than a dozen states are considering a variety of solutions to the problem of dwindling retirement security,” Biss said. “I’m pleased Illinois is at the forefront of enabling people to maintain dignity and quality of life after they leave the workforce. My hope is that other states would follow our lead in seeking solutions to this pressing and underreported crisis.”

Researchers at the National Institute on Retirement Security estimate that the national retirement savings deficit is at least $6.8 trillion. One of the major causes of this problem is the huge number of employees who lack access to work-based retirement plans.

Secure Choice will tackle this by automatically enrolling most such workers in a portable Roth IRA savings account. Those who do not want to participate may opt out of the plan at any time. More information about the program, which could be implemented as early as June 1, is available online.

Bill Smith is the editor and publisher of Evanston Now.

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3 Comments

  1. Based on what I read in the

    Based on what I read in the Trib, the bill could cost small businesses some unwelcome costs. We will need to see how this works out.

  2. Invest with the government?

    Invest with the government?  No thanks. I trust myself more. 
    Here are the rules I’m following  –

    Rule #1: Pay yourself FIRST.

    Rule #2: Don't let greedy salesmen/brokers/agents take any of your money in fees, commissions, loads, etc. Do the paperwork yourself with a discount broker – Fidelity, Vanguard, TD Ameritrade, etc., then invest in no-load mutual funds with no front loads, no back loads, and certainly NO 12b1 FEES whatsoever. It will make a difference of hundreds of thousands of dollars by the time you retire!

    Rule #3: Don’t waste money on stupid stuff you don’t need. Don’t get $100/month smart phone. I pay $20/month with tMobile. Don’t get $100/month auto insurance. I pay $24/month with Insurance Panda. Don’t spend $50/month on your gym. I spend $15/month at Planet Fitness. All these expenses add up and end up cutting into your savings.

    Rule #4 Save at least 10% of your gross income. Join your 401k at work, set up IRAs on your own.

    Role #5: Again – Pay attention to your savings. As they grow you will feel empowered

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