The Illinois Secure Choice program has attracted 32,000 participants and $8.5 million in retirement savings assets in its first year of business, Illinois Treasurer Michael W. Frerichs reported Monday.
Illinois was the first state to authorize a private-sector retirement savings program under a law enacted in 2015. It requires employers in business for at least two years and with at least 25 employees to either offer a retirement savings plan or participate in Secure Choice.
Employees are defaulted in at a 5% contribution rate to a Roth IRA account, which they can change, or they can opt out of the program.
The program was rolled out in phases, with employers with 500 or more employees required to register by Nov. 1, 2018, and smaller employers with between 25 and 99 workers registering by Nov. 1, 2019, for a total of 4,691 businesses participating.
The investment accounts are portable, with four investment fund options. The program is managed by Ascensus.
Mr. Frerichs said in a statement that 47% of Illinois private-sector workers do not have access to a workplace retirement savings plan. "Everyone should have the opportunity to retire with dignity. Secure Choice allows workers to save their own money and protects employers from the federal regulatory burden that often accompanies such plans," said Mr. Frerichs, who as Illinois' chief investment and banking officer, actively manages $31 billion.
Oregon launched the first Secure Choice program, which is expected to be available for more than 1 million Oregon-based workers when fully implemented in 2020. The third — and largest — state-sponsored retirement program opened for business July 1 in California for an estimated 7.5 million eligible workers.
Similar programs in Maryland and Connecticut are expected to be launched in 2020.