State Auto-IRA Programs: The Keys to Financial Self-Sufficiency

Source: Alicia H. Munnell, Anek Belbase and Geoffrey T. Sanzenbacher, Center for Retirement Research at Boston College (CRR), IB#16-19, December 2016

The brief’s key findings are:
– State auto-IRA programs for private sector workers are intended to pay for themselves.
– This goal is achievable in the long run, but auto-IRAs will incur losses initially.
– The keys to financial self-sufficiency are to:
– keep per-account costs low;
– set meaningful participant contribution rates; and
– charge higher fees initially or finance start-up costs over a longer period.