NEW YORK, Feb. 19, 2016 /PRNewswire-USNewswire/ -- Millennials planning for retirement? It's never too early – especially since more and more lack access to the kind of workplace retirement savings plans earlier generations took for granted.
AARP and Young Invincibles hosted Cheers to Your Future: A Happy Hour on Millennials' Economic Outlook, featuring City Comptroller Scott Stringer, Public Advocate Letitia James, Demos and about 50 Millennials, at Joe's Pub in the Public Theater in Greenwich Village Thursday night (February 18, 2016).
The groups are supporting "Secure Choice," state legislation sponsored by Senator Diane Savino of Staten Island and Assemblyman Robert Rodriguez of the Bronx that would establish a state-facilitated plan to give working New Yorkers of all ages the option to save at work via payroll deduction if their employer offers no such plan.
Mayor Bill de Blasio announced this month he would introduce ="https://medium.com/@nycgov/one-nyc-working-for-our-neighborhoods-35ad77dd7780#.ble19lukc" rel="nofollow" target="_blank">city legislation to make New York the first city in the nation with such a savings plan, working with Public Advocate James, Comptroller Stringer and City Council Speaker Melissa Mark-Viverito.
At Thursday night's event, Young Invincibles detailed its nationwide survey of 800 voters ages 18 to 34 showing over half of low-income Millennials lack access to retirement plans through work – while the generation (those born starting in the early 1980s) has less wealth than previous generations did. The survey found 85% of Millennials would support a state-facilitated retirement plan that provides "a voluntary option for workers without a way to save for retirement at work." The support transcends political affiliation and ideology.
AARP research has found over 60 percent of 18- to 34-year-old private sector employees in New York state lack access to workplace retirement plans. AARP surveys of city Generation X and Baby Boomer voters found 76% support a Secure Choice type plan.
With Millennials set to make up a majority of the workforce by 2020, the time to act is now.
"As the City's independent watchdog, it's my job to make sure every New Yorker, no matter their age, has a fair shot at a stable financial future," said City Comptroller Scott Stringer. "Too many New Yorkers don't have the tools to start planning for their retirement security, and that has the potential for a real economic impact on our City. I commend AARP and Young Invincibles for thinking innovatively about how Millennials can plan for their economic well-being today and years into the future."
"Millennials and all New Yorkers need a reliable way to save their own money and become self-reliant in retirement," said Beth Finkel, State Director for AARP in New York State. "The Secure Choice bill would provide a win-win-win; it would help millions of hard-working New Yorkers save their own money, help taxpayers by reducing the need for public assistance down the road, and help thousands of employers large and small that want to offer retirement savings plans to be more competitive but can't afford to do so."
"The Great Recession wreaked havoc on Millennials' financial well-being," said Kevin Stump, Northeast Director of Young Invincibles. "More young workers are finding work in low-income and benefit-poor industries that do not equip them with the savings tools needed for retirement. In fact, less than half of low-income Millennial workers have access to a retirement plan through their employer. Our poll makes clear: Millennials want to save and support state-facilitated retirement savings plans. We should move on Secure Choice legislation swiftly to better ensure the financial health of our generation and New York state decades into the future."
"Millennials are facing multiple economic pressures, none more acute than the massive rise in student debt," said Mark Huelsman, senior policy analyst from Demos. "Unfortunately, this isn't the only form of economic insecurity faced by this generation, who are contending with stagnant wages, the increased cost of child care, and a lack of opportunities to build wealth in the same manner as previous generations. Fortunately, public policy helped create these problems, and public policy can lead us out of them."
Americans are 15 times more likely to save for retirement if they have access to employer-sponsored plans – and too many aren't saving enough.
Social Security, while providing a critical safety net, will not be enough for New Yorkers in retirement; the program's average annual benefit in New York is below $16,000 – in other words, below the federal poverty line.
The National Institute on Retirement Security estimates a $6.8 trillion national retirement savings deficit.
"The retirement savings gap is real for too many," added AARP's Finkel. "It's a quiet crisis that could turn catastrophic if ignored."
The Secure Choice Plan:
- A voluntary payroll deduction IRA (Individual Retirement Account).
- All employees' accounts would be pooled and professionally managed and invested, ensuring low fees and competitive investment performance.
- Workers could take their retirement savings accounts with them to a new job.
- No ongoing costs for the state.
- Neither the state nor the employer would be responsible for market losses or gains.
SOURCE AARP New York State