Illinois is seeing steady growth in worker participation despite the economic mess brought on by the coronavirus. In March, Illinois Secure Choice had 60,000 funded accounts, with $17.2 million in assets. In November, those numbers had climbed to 77,000 and $42.8 million.
“To me, that underscores the value of these programs and the importance of having access,” said Courtney Eccles, the director of Illinois Secure Choice.
As auto I.R.A.s gain footholds around the country, critics have surfaced. “It’s hard to say it’s a bad thing to make a savings opportunity available to people, but I would have preferred that there was more thought behind them,” said Andrew G. Biggs, a resident scholar at the American Enterprise Institute, a conservative think tank, and former principal deputy director of the Social Security Administration.
“A danger I see is, if you offer these plans, employers that are offering 401(k)s might stop doing that,” he said, given that employers can’t match employee contributions. “If you’re a start-up company, you might say, ‘Just put me in the auto I.R.A.”
In addition, Mr. Biggs said, “if you’re a low-income person, you probably have bigger fish to fry” than saving for retirement. As a partial solution to the savings crisis, he recommends increasing Social Security benefits “pretty substantially” for low-income workers.
Yet employers like Ms. Geske, who is also a Secure Choice saver, are relieved to have the option.
“I’m 51, and before this program came along, I had no retirement savings,” she said. “I was putting everything I had into the business. Now I’ve been checking my account balance, and I see I’m actually making money I don’t even miss, and I’m kicking myself for not starting earlier.”