Legislation that would create a private-sector version of the $553.8 billion Thrift Savings Plan, Washington, was introduced Thursday by Sen. Jeff Merkley, D-Ore.
The proposed American Savings Act would make available to workers without workplace access to a retirement savings plan an "American savings account," with the same low-fee investment options that are in the TSP.
Under the proposal, employers not now offering plans would send 3% of workers' earnings to the accounts, but employees can lower that to 2%, raise it to as much as $18,000 per year, or opt out entirely. Participants could roll in their existing individual retirement accounts, or roll ASA funds into an employer-sponsored 401(k) or 403(b) plan.
"It shouldn't matter whether you work part time or full time, as an employee or as a contractor, or for a huge corporation or a tiny business: Every American worker deserves access to a financially secure retirement," Mr. Merkley said in a statement.
"This plan helps millions of American workers to save easily and automatically for retirement with tax benefits, rock-bottom fees and the same types of high-quality investment options already enjoyed by federal workers and members of Congress."
David Madland, senior fellow at the Center for American Progress and senior adviser to its American Worker Project, said that expanding access to a TSP-style plan "could help shore up our private retirement system, which is currently failing to meet the needs of a significant part of our workforce."