Calif. creates state-run private retirement plan

[warrior1]

http://news.yahoo.com/calif-creates-state-run-private-retirement-plan-232409988--finance.html

http://l.yimg.com/bt/api/res/1.2/71zDaQMY5.S.nILN5_hI5g--/YXBwaWQ9eW5ld3M7Y2g9MzAwO2NyPTE7Y3c9NDUwO2R4PTA7ZHk9MDtmaT11bGNyb3A7aD0zMDA7cT04NTt3PTQ1MA--/

SACRAMENTO, Calif. (AP) — California Gov. Jerry Brown signed legislation Friday that will create the nation's first state-run retirement savings program for private-sector workers, over the objection of critics who said it creates a new liability for taxpayers.

The bill will establish the California Secure Choice Retirement Savings Program for more than 6 million lower-income, private-sector workers whose employers do not offer retirement plans.

The program directs employers to withhold 3 percent of their workers' pay unless the employee opts out of the savings program every two years. It would be administered by a seven-member board chaired by the state treasurer.

State Sen. Kevin De Leon, D-Los Angeles, introduced the bill earlier this year in response to what he called the "looming retirement tsunami" as millions of lower-wage workers face financial hardship in their retirement years. He said the program will act as a supplement to Social Security by offering private-sector workers a portable savings plan with a guaranteed return.

[upaloopa]

1. We are so damned smart here CA. See what can be done when you have a Democratic government.

government.

[tularetom]

2. I may be dense but how does that bill create a liability for taxpayers?

The retirement program is funded by contributions from employers. And those contributions are coming off the top of the salary the employees already receive so there is no additional cost to the employer (other than bookkeeping/accounting overhead).

And the employee can opt out. So what's the BFD? Sounds like a good program to me.

[Honeycombe8]

5. Well, it will cost to set it up and run it. A new expense. But should save the country in the

long run, as people with more savings when they get older may work a little longer, or be able to have a little expendable income in their retirement years.

It sounds like a win-win, for the long-term.

[RB TexLa]

3. Financial services companies were against this. I think it will help them greatly

You will now have a lot more people looking at saving for retirement. If you can beat what the state offers, get out there and let them know the product is available. They aren't locked into the state's plan.

I think this will serve to raise awareness for lots of people who don't think about retirement planning right now.

[bluestate10]

4. California should ask the Federal government to give it back 25%

of the money that it now send out to support red states. Other blue states should follow California on the demand.

[Sirveri]

6. They would laugh and point at the sixteenth amendment

But I support the concept. I actually support it so greatly that I've seriously considered joining/starting a secession movement for that very reason.

We're the Golden goose, and they desire to starve us and strangle us.