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State-Run Retirement Plans Are Not a Complete Solution

Savings vehicles for private-sector workers are better than nothing, but they aren't a substitute for employer plans.

Note: This commentary from Morningstar director of policy research Aron Szapiro is in response to recent developments in retirement-savings efforts. 

California recently began setting up California Secure Choice, an effort to help millions of workers who don't have employer-offered retirement plans. California is on the vanguard, but it is being joined by at least five other states (Connecticut, New Jersey, Oregon, Maryland, and Illinois) that are trying to set up similar savings vehicles to increase retirement savings. The media (and the state governments) has described these savings schemes as 401(k)s for everyone.