Colorado’s Secure Savings Program Draws in Thousands of Workers

The Colorado Sun news source reports that one year after Colorado launched its SecureSavings retirement funding program for workers whose employers didn’t offer one, nearly 55,000 workers have opened an account and started setting aside part of their paycheck. It appears the launch of SecureSavings in 2023 may also have prodded a number of Colorado small businesses to start 401(k) retirement plans, adding more employees to the pool of those having some form of savings plan for retirement. SecureSavings requires Colorado employers to sign on if they have been in business for two or more years, have at least five employees who have worked for them 180 days or more, and don’t currently offer a qualified retirement savings program to employees. These businesses automatically enroll their staff in the program and set up auto-deduction from their paychecks. (Employees may opt out within 30 days if they choose.) An employer may start a private retirement plan program like a 401(k) for employees instead of going the SecureSavings route, and many businesses have done so. The goal is simply to get more employees started on saving for retirement. U.S. Census data indicates 49% of adults nationally age 55 to 66 had no personal retirement savings in recent years. It’s not clear how many Coloradans over 55 have a retirement account, but AARP puts the number at only about 30%. At the time SecureSavings was launched, it was estimated nearly 1 million Coloradans had no access to a retirement plan at work, and as many as 85,000 employers might be eligible for the program. The Sun says demographic data suggests that more than half of employees newly enrolled in SecureSavings are over age 40. Gusto, a company that provides HR and payroll benefits services to small businesses, said the largest effects of the mandate under SecureSavings are seen among low-income workers. For example, the rates of 401(k) enrollment in Colorado have nearly doubled across low-income workers at firms subject to the mandate. Gusto added that data also shows that offering retirement plans has helped small business owners reduce employee attrition by 40% over one year. You can learn more about SecureSavings in our AgeWise Colorado article at https://agewisecolorado.org/blog/colorado-securesavings-aims-to-build-retirement-funds/.