By: Tamara Orozco
United Way Bay Area, in partnership with CalSavers, recently hosted the CalSavers Bay Area event to launch a new retirement savings program that will provide millions of Californians with access to save for retirement.
Currently, 7.5 million Californians do not have access to a retirement savings program through work. According to AARP, two-thirds work for small businesses, two-thirds are people of color and nearly 60 percent are women. Furthermore, nearly ½ of Californians are projected to retire into economic hardship–at or below two times the federal poverty level.
CalSavers addresses this gap by providing a retirement savings program that is accessible to millions of Californians and simple for both employers and workers to participate in. Through CalSavers, businesses that don’t already offer a retirement option will be able to facilitate a retirement savings program without any fiduciary responsibility, administrative headaches or fees. In fact, by 2022 businesses with five or more employees will be mandated by the state to offer access to a retirement savings program.
CalSavers will finally put millions of Californians on the path to a more secure retirement by allowing them to make automatic payroll deductions to a portable retirement savings account. Studies show that workers with a payroll deduction savings option are 15 times more likely to be on a path to retirement security and 20 times more likely when it’s automatic enrollment.
“As an organization dedicated to fighting poverty, UWBA knows that having access to a retirement savings program is not enough,” says Kelly Batson, UWBA’s Senior Vice President, Community Impact. “UWBA is focused on increasing the savings and wealth of working families in order to ensure their financial stability. For many groups—lower-income, black, Latinx, non-college-educated, and unmarried Americans—the typical working-age family or individual has no savings at all in their retirement accounts and for those that do, the median balances in retirement accounts are very low. UWBA and CalSavers are working to change this.”
United Way Bay Area in partnership with the California State Treasurer’s Office is excited to help launch this program in the Bay Area that will make a difference in the lives and futures of hundreds of thousands of workers. In the Bay Area, over 34,000 employers and more than 827,000 workers are eligible for CalSavers.