MANDATORY Retirement Saving

[Anonymous]

UPDATE

Sunday - May 16, 2021 5:15am EST

This discussion is now over! Thanks 🙂

ORIGINAL POST DATE

April 5, 2021

What do you think of MANDATORY retirement savings on the job?

Lol, I was NOT happy when the hospital I worked at made me save 3%. 13 months later, I was do ELATED to have the savings. They are now talking about making ALL employees SAVE for savings.

Link to article on Google News 

[Underbat]

This thread is now locked at the request of the Original Poster

[Anonymous]

Sunday - May 16, 2021 6:10am EST

1. A HUGE thank you to AARP Moderator @Underbat 
2. For removing my LAST comment (per my request) on this discussion I had CREATED and PRIVATE MESSAGING me to discuss my concerns and show me how to REPORT future requests and concerns.
3. Lol, thought I would have to take another mini-break from this board to CALM DOWN 😉 Have had to take several since joining this board October 2019 😂🤣 Took off 2020, was still working and awful work environment. Returned this year (2021) now retired 🙂
4. I am ENCOURAGED (things are changing for the better) that MODERATORS are here for us!!!!
5. Now all, I am CLOSING OUT this discussion and walking away. Lol, got High Blood Pressure and STRESS from my UPSTAIRS neighbors. Need a place to hang, like here, chat with some folks. Left FB and Twitter when I RETIRED. Luv being here.
6. Thanks again AARP Moderator  @Underbat 
7. HAPPY SUNDAY ALL 🙂 🙂 🙂

[GailL1]

I did look it up and this is NOT a mandatory retirement saving - It is a mandatory setting up of an account and then depositing the money the EMPLOYEE designates to it.  Anybody could have set up their own as a Traditional IRA and then make deposit to it - all this NYC legislation does is mandate the employer do everything FOR THEM. - set up the account and then deposit what the employee tells them to deposit out of their pay check into it.  

Someday maybe we will see the wisdom in teaching people how to do things for themselves so they can learn and take further action to better themselves instead of mandating that some other entity do it for them; especially employers.  

I mean how hard is it to set up a Traditional IRA account for ones self ?  How hard is it to manage your own money and deposit some money into this savings on a regular basis? 

Especially since much of this can be done with the click of a button on a tech. device.

Really, how much is this teaching people about what they could do for themselves?

Wonder if the employer will also be required to make sure that each of these DEPENDENT employees does their taxes correctly and take advantage of the IRS.gov - Retirement Savings Contributions Credit (Saver’s Credit)   In essence, FREE MONEY courtesy of the tax code !

Guess my definition of being an "adult" differs from others - I consider a person's own money similar to children.  The responsibilities of a loving parent - one should always know where it is and what it is doing !!!  This sort of mandate does nothing to teach a person personal responsibilities - it just does it FOR them.  

ASPPSA.org (American Society of Pension Professionals & Actuaries) 05/12/2021 - NYC Mayor Signs Mand... 

from the link ~

Under the legislation, the default employee contribution rate will be 5%, which employees could opt out of at any time or adjust down or up to the annual IRA maximum. Savings in the plan will be portable, allowing employees to continue to contribute or roll over their accounts into other retirement savings plans when they switch jobs. 

In addition, covered employers are not required to contribute on behalf of employees. However, they will be required to enroll each of their covered employees in the program. They also will be required to remit funds deducted from the earnings of each participant for deposit in the program and to distribute program information to employees. 

[GailL1]

SECURE ACT 2.0 - once again (like the SECURE ACT 1.0 passed in December 2019) it is messing with people's accounts that are close to retirement. If passed, the bill would not only require auto-enrollment in employer-sponsored retirement accounts but increase the age for required minimum distributions, which is when an individual is forced to take withdrawals from their 401(k) plans and individual retirement accounts.

That's already been done with the SECURE ACT 1.0 - guess they are making it higher.  Too bad for many of us who are already having to take RMD's  😥

I'll have to keep up with this one - personally, I am not real keen on employers spending employees money - I would prefer that they give the workers ALL their money and educate them on retirement or health insurance and let the employees learn and do it for themselves.  Otherwise, aren't we still just babysitting employees?  Using their employers as surrogates for parents - Making decisions for adults that should know how to do it themselves - This bill seems to be doing a lot of that - based on the linked article.  Am I living in a fantasy land with my expectations?

[Gorm50]

ERISA 74 relieved corporations of pension funding and portfolio performance. They BEGGED for this because they wanted to be relieved of pension longevity and payout risks.  FACT is investing was dumped on employees with ZERO experience. To that end some retired with nice 401k assets while others did NOT. 

It is obvious WE need to do something to require workers save or they become wards of the state.  While SSA was NEVER anything but designed to be supplemental to retirement savings many today EXPECT it should afford them a decent retirement lifestyle. WE cannot afford that!!

As to HOW, I would recommend some government administered pool of ETFs across the investment spectrum, ie DOW, S&P,  Nasdaq  plus international, etc.  where a servicer effects trades on behalf of employees vs employers contracting with the likes of Fidelity, etc to afford employees investment MF options.  

[Anonymous]

April 14, 2021

@Gorm50 I appreciate you stopping by to join our discussion 🙂

[WanjirusBits]

Your proposal is ideal - educating workers about personal finance and health, but I doubt that would mesh well with politics.

[Anonymous]

April 14, 2021

@WanjirusBits I appreciate you stopping by to join our discussion 🙂

[GailL1]

@Anonymous 

But would your "hard-headed' daughter like being forced to do it (mandated)?

Right now, the employer has an option to set up a plan, your daughter has the option as to how much of her pay to contribute.  This bill places forced actions on both the employer and the employee, the way I am reading it - like I said, will have to follow it and look at the legislation - it is a do-over from 2020.