Life changed quickly for Ernesto Olmos when he left the U.S. Marine Corps. After being stationed in North Carolina for four years, the corporal and his wife moved to California — and were hit with a drastic increase in housing costs. “My wife and I had prepared for some of these financial differences in advance, but the hike in rent was substantial. We went from paying $750 for a townhome to seeing one-bedroom apartments for about $1,500 in Santa Clarita,” he says. Olmos’ mother suggested the couple apply for a four-bedroom house with Homes 4 Families. The Citi-supported organization provides affordable housing to low-income, honorably discharged veterans. Their application for a new home in Santa Clarita Valley was accepted in 2016. In addition to providing housing assistance, the Homes 4 Families’ initiative offers a free financial education program called Clearpoint Reconnect, operated by Money Management International. The program includes online courses, workshops and counseling for military families transitioning to civilian life. While Olmos’ home was being built, he completed a financial planning exercise to reduce credit card debt, took educational courses to increase his long-term financial security and learned to manage his new home as an investment. “I have never been one to think about retirement, but the but the worksheets made me realize that we need to plan for the future,” Olmos says. For veterans early in the transition stage, counseling programs like Clearpoint Reconnect can offer a particularly helpful field guide for understanding unfamiliar financial processes. “Having that financial education stays with them long-term,” says Ruth Christopherson, Senior Vice President of Citi Salutes and Citi Community Development, which has supported the Clearpoint Reconnect program since 2012. “Things can change, but understanding their financial plan prepares vets for bumps down the road. If one’s car breaks down or if a vet loses a job, this counseling program can keep them out of debt, and they have the education to keep moving forward.” The program includes phone, online and in-person sessions on subjects like understanding credit and debt, and avoiding bankruptcy. Clearpoint Reconnect also offers student loan and home mortgage consulting. “Many veterans find it challenging to adapt to the world of civilian finances, and it might take two or three years to sort things out,” says Kate Horrell, a military finance coach. “Most people don’t understand the many ways their finances will change when they leave the military. Certain benefits will no longer be free, and your entire paycheck will be subject to taxes.” Jeffrey Lodick, a former Army master sergeant and current host of the “On the Other Side” podcast, is no stranger to the challenges of decoding a civilian paycheck. After retiring in September 2017, Lodick’s shift to the private sector included a salary learning curve. “I couldn’t tell you what my salary was in the military,” he says. “I knew what I got paid on the first and the fifteenth of each month, not what was going to the GI Bill and my taxes.” As someone who hadn’t scrutinized his military paycheck for 20 years, navigating private sector tax paperwork took effort. “As silly as it sounds, I didn’t know how to fill out a W-4,” Lodick says. In addition to a new salary, Lodick entered a different tax bracket, which created another set of unknowns. “I never had any assets to deal with. It’s going to be a learning process.” Lodick’s situation is not unique. “Military retirees are stupendously unprepared for changes in their tax situation,” says Horrell. When they return to civilian life, vets are often unaware that they need adjust their taxes to account for military retirement and avoid under-withholding. “You could end up owing more than $10,000 because of under-withholding two different sources of income,” says Horrell. “Any income changes need to be reflected in a W-4. This doesn’t seem to be immediately apparent to everyone.” The upside? Veterans and tech communities are responding to the challenges with a growing set of tools to ease the transition. In addition to Clearpoint Reconnect, whose services are free to all military personnel, Military.com, TheMilitaryWallet.com, and LaceyLangford.com are excellent resources that focus on military money issues.
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This article is paid for and produced in partnership with Citi. Through Citi Salutes, Citi collaborates with veterans’ service organizations and leading veterans’ champions to support and empower veterans, service members and their families. This is the second installment in a series focusing on solutions for veterans and military families in the areas of housing, financial resilience, military transition and employment.
Florida condos, group bus trips and endless games of Solitaire may be a thing of retirement past. The typical American Millennial is unlikely to mirror the retirement of their grandparents — or even their parents. According to analysis in the publication Science, developed countries have seen an increase in longevity, more than two years every decade. A person born in 1998 is likely to live to 95, assuming she has reasonable access to education and healthcare. This means that your golden years might be almost as long as your professional life. Spending 35 years lounging by the pool or playing mahjong is unlikely to appeal to Millennials, who seem to prefer transience to routine.
When Social Security was first established in 1935, life expectancy was around 61. For those trying to fit in education, a family and a job to support that family, there wasn’t ample time for leisure and other activities. It’s no wonder then that Americans defaulted to a three-stage plan that focused on those three things. Adding an upward of 40 years to a lifespan frees things up bit to make life more fulfilling, and in turn, provides the opportunity for a “multi-stage life.” Coined by Lynda Gratton and Andrew Scott, authors of “The 100-Year Life,” the concept outlines the shifting of our life trajectory from being progressive and defined by three stages to one that’s non-linear and filled with diverse careers, breaks and adaptations.
“The current trends of this three-stage life cannot work for someone with potential to reach 100 [years of age],” says Scott, professor of economics at London Business School. “Instead, a multi-stage life will be made up of many different stages each with different aims — perhaps one aimed at making money, another with a better work/life balance or a third focused on self-expression. Each stage will require a reboot to prepare a new identity and skills for the stage ahead.”
Millennials are leading the way by redesigning their 20s as a distinct age stage. The focus: Spend your second decade determining your values, your strengths and priorities — a time to hold off on early commitments and explore ample possibilities.
A recent Merrill Edge Report shows that 42 percent of 18-to-34-year-olds designate working their dream job as a personal milestone. Thirty-seven percent make traveling the world one of their top priorities. And almost two-thirds of Millennials are saving to live out their desired lifestyle now, as opposed to 55 percent of Gen Xers and baby boomers who put money aside for retirement. Call it FOMO retirement planning: Younger generations are no longer looking at their adult life as a predetermined, linear path. Instead, they’re taking a hop-on-hop-off trolley approach by nurturing personal goals. Read on to see how you can catch a ride for this multi-stage life.
Embrace Transitions
The multi-stage life counts on being adaptable in all areas: career, relationships, family and beyond. “Flexibility requires that we set aside what has already happened so that we can be open to what arises next,” says Henry Emmons, holistic psychiatrist and co-author of “Staying Sharp.”
Curiosity is an important driver in creating this flexibility. It challenges us beyond what we already know, which results in a bit of (good) stress that resolves when the related task is complete. Think about trying an exotic food. Inquisitiveness makes you wonder what it tastes like, followed by tension before you experience the unknown flavor, until your brain registers the entire experience as new taste. “As far as the brain is concerned, curiosity pushes us to keep going and thus, creates new neuropathways,” Emmons says. “It’s the best things we can do for ourselves, especially as we age and become set in our ways.”
Identity is often shaped by a particular job. When you’re not limited to a single career, however, you’re open to experiencing various roles. “You need to think about your identity in a different way,” says Scott. Reinforcing the idea that a gap year is no longer limited to college graduates, and instead, an acceptable (planned) exploratory period every few decades, is bound to reboot any inertia along the way.
Invest in New Skills
If you don’t disrupt the three-stage life, you’re likely to feel bored or frustrated during your centenarian life. “The human psyche needs to keep growing and learning,” says Emmons. “The antidote is to keep yourself engaged and try new things to create a sense of momentum that gets you out of a repetitive pattern.”
In order to stay current, one should be ready to adapt — and often. Unknown opportunities will arise a decade from now, so it’s vital to reskill every three to five years. Virtually every job today requires at least some computer skills, and those at the helm have a clear advantage. New technologies, like robotics and Artificial Intelligence (AI), will further disrupt the playing field. The International Federation of Robotics forecasts that the number of industrial robots will increase by 13 percent each year between now and 2019. According to the McKinsey Global Institute’s June 2017 report, “Artificial intelligence tools have the promise to change our lives as fundamentally as personal computers did a generation ago.” Because almost a quarter of firms that have adopted AI expect to grow their workforce, not reduce it, individuals need to acquire skills that work with, not compete, against machines.
This approach challenges the collegiate “learn then earn” model that can’t keep up with fast-paced job market. A “nanodegree” may be the answer to get ahead in this new digital frontier. Udacity, an online education hub, has pioneered the concept of offering tech-savvy courses — including Robotics and Self-Driving Car Engineer — that further one’s career without costing much time or money. These courses aren’t just useful for a Silicon Valley wannabes; the financial, media, retail, education and healthcare sectors, as well as the travel industry, are all integrating various degrees of AI into their frameworks.
While automation is the asset du jour, robots alone can’t monopolize the workforce. A perk of being human is that mental plasticity drives innovation and creativity. Take this success story: A computer science whiz was able to break into the L.A. fashion industry because her coding background allowed her to develop programs for printing patterns on different textiles. “She had the visions of a fashion designer, but also understood the mechanisms to bring her visions into reality,” says Valerie Streif, senior advisor with Mentat, a San Francisco-based organization for job seekers. “You’re able to jump fields as long as you’re willing to take on new challenges.”
It’s crucial to develop transferable soft skills such as leadership and communication — something the smartest robot cannot match. “Emotional intelligence is the most desirable soft skill of all,” says Streif. “The ability to read people sets you apart as a leader.”
Strive for a productive life
Planning for a multi-stage life is more than lining up your finances (more on that later). Family, friends, health, mental well-being and knowledge are the building blocks of an enjoyable long life. Aside from providing a nurturing day-to-day experience, these intangible assets are crucial during transition periods that often need extra support.
On the home front, actually coordinating and switching roles — a theory coined by Nobel prize-winning economist Gary Becker back in 1981— allows each partner to further develop different life stages while still maintaining the much-needed income stream. Domestic partnership roles based on traditional patriarchy simply can’t benefit both parties, not in the long-run anyway.
Much like financial investments, intangible assets like friendships need diversification and consistent attention to grow. (After all, you can’t bank on college to set you up with friends for the next 80 years). This is where volunteering, civil service or caregiving come in. Non-homogenous relationships make you less prone to stereotypes, prejudice and ageism — boosting your reputation as a people-person, a characteristic that carries enormous value in every day interactions and the workforce.
A productive life also means prioritizing a healthy mind and body. The healthier you are in your youth, the fewer chronic conditions should pop up later on. Conversely, an unhealthy lifestyle doesn’t just wreak havoc physically; it can drain savings due to the already volatile state of healthcare. If practicing meditation seems too advanced, develop good sleep patterns. “It’s the single most protective thing for the body and the brain,” says Emmons. Sleep is like going into a repair shop to tweak all those micro injuries that happen during the day. “Deep sleep allows the brain to cleanse itself and opens up channels that are closed during the day,” he adds.
Revamp your financials
According to a Bankrate.com report, seven out of 10 of non-retired Americans plan to work as long as possible during retirement. Of those, 38 percent plan to remain employed because they like to work, and 35 percent said they plan to have a job because they need the money; 27 percent said both. When you consider that a third of Millennials believe Social Security won’t be available to them, retirement savings must take priority. “Everyone, especially Millennials, should get in the habit of saving 15 percent of their income for retirement,” says Greg McBride, chief financial analyst at Bankrate.com. “Ideally through tax-advantaged retirement accounts such a workplace 401(k) and an IRA. Establish this habit early on and it will stick with you as earnings grow.”
In fact, you might need to stash as much as 25 percent of your income — a challenging task if student loans and travel eat up a saving than previous generations.
While Millennials are better at saving than previous generations, the Great Recession has made many question the security of investment plans. The fear is not warranted, says McBride. “Who cares what the market does next year, or the year after. You’re making contributions. If the market goes down, you get better price on your next contribution. The stock market is the only place, when it goes on sale, people run the other way.”
But what about paying off student loans? A fair question given the fact that 70 percent of college graduates are left with $38,000 in debt, on average. While a looming loan can be psychologically burdensome, making consistent payments towards your loan for 10, or even 25 years if you’re furthering your education, is often the right plan, particularly if you’re also paying a mortgage or other debt. Contributing to a 401(k), particularly if your employer offers dollar-for-dollar matching, is another smart alternative to paying off student loans right away.
Restructure time
“We don’t yet know what exactly works over 100 years, and it will be a long while until we do,” says Scott. That’s why it’s a good idea to ignore the clock a bit. Your 20s are becoming increasingly accepted as a time to be liberated and to transform your interests into more permanent sectors of your life, such as different careers or lifestyles. Think of your 30s as the test-drive decade for all those self-discoveries made during the previous decade. Perhaps your 40s is a time to make tweaks or shift gears. Once you’re in your 50s, ponder whether your older self will approve of how you’re setting up your life for the next stages. “Unlike past generations, it’s important to keep giving yourself options throughout all ages,” says Scott. “You find out what you like by both doing it and by rejecting what you don’t.”
The advantage of looking at life as a non-linear progression frees you up to make choices that may otherwise feel risky when you’re bound by the expectations of the three-stage life. Millennials are on the right track by delaying marriage and children in order to make time for self-discovery, find well-fitting careers and partners and enhance their community.
Going forward, each person has the opportunity to create a unique path. But to do so, we have to become age-agnostic. Repeat the following: Age does not equal stage. In other words, there are no rules when you can be a college student or a spouse, or hold a certain job. Overthinking whether you fit into a mold can be detrimental in the long run. “Worry and fear lock us in and create a sense of stagnation,” says Emmons. This post is paid for by AARP.
Drugstore shelves are lined with anti-aging products: creams to erase wrinkles, supplements to stimulate thinning hair, miracle pills claiming to restore damaged cells. If there’s one endeavor that unites us, it’s that most Americans desperately want to preserve their youth.
When people ask Kamili Wilson, VP of AARP’s Enterprise Initiatives and a NationSwell Council member, how they can turn back the clock, she has a quick answer: “You don’t.” People might not want to come to terms with their aging faces and bodies, says Wilson, but that’s just reality. “It’s a process we all experience, if we’re fortunate enough. How can we consider that an opportunity, versus a challenge that we wish we could avoid?” Disrupt Aging, a new initiative by AARP spearheaded by Wilson, is subverting long-held assumptions about getting old. Instead of waging war on one’s gray hair, Wilson suggests that we ask ourselves, “How do I age with purpose? How can I feel comfortable with the age I’m at?”
As Americans continue to live longer, the Disrupt Aging campaign points out that vitality can be found at any stage of life. But embracing that notion requires a shift in our collective mindset. NationSwell consulted with experts on aging to zero in on easy ways that everyone can rupture stereotypes in everyday conversation. 1. “It must be pretty depressing, watching yourself get old.” “We’ve found as people get older, they fear their opportunities start to shrink,” says Heidi Sternheim, a brand strategist at AARP. “The truth is that age is no longer a defining factor in life, and the way we are aging now is a lot different than in the past. We’re staying healthier longer. We’re reinventing how we work and play. Yet we’ve found, through our own research, that most of our beliefs about aging have remained about the same.” In other words, growing older doesn’t have to be limiting, as long as you have the right mindset. “Aging is not about decline, but about growth,” Sternheim argues. 2. “Mom, women your age don’t dress like that anymore.” In too many portrayals, older people wear oversize, scratchy sweaters. Their hair is unkempt, and they shuffle along with a cane. “The stereotype is that a person peaks in their career in their 40s, and heading into their 50s and 60s, they slow down cognitively and physically,” says Wilson. But to her, that couldn’t be further from the truth. All you had to do is pick up the newspaper in the past few months, she says, to see two “over 50s”— 70-year-old Donald Trump and 69-year-old Hillary Clinton — enduring a grueling election campaign. “That is one misperception, that there’s not a lot of energy, passion or enthusiasm,” she says. To that end, there is no reason for adult children to dampen their parents’ vivaciousness, no matter what form it takes. 3. “You’re just not what we had in mind for the job opening.” Sexism, racism, homophobia: Most of us are familiar with these forms of discrimination. Less discussed yet equally prevalent is ageism, the wrongheaded belief that a middle-aged hire won’t adjust to a new workplace as well as a fresh-out-of-college twentysomething. For starters, tossing out job applications from non-millennials is illegal. And it may also be short-sighted, adds Edward Newburn, who works in AARP’s chief-of-staff office. “With age comes wisdom. Not to discredit [a young person’s] intellect, but wisdom is something that is acquired over time,” he says. “Younger individuals are still in development, whereas an older worker would have more concrete skills.” Another benefit of taking a closer look at a prospective older employee? “A diversity of viewpoints will have more luck reaching a range of customer groups than one age cohort alone,” says Wilson. 4. “Sorry to say, Dad, the nursing home looks like our only option.” The nursing home is “probably the most dreaded place anybody can think of ending up in,” Newburn says. The cafeteria food, repetitive bingo games and medicine carts parked in the hallways all suggest a dreary end. Recently, senior housing has shifted away from this “antiquated, hospital-style system,” as Newburn describes it, to giving elders more choice about their final residence. One option is simply to stay in one’s home and hire nurses or other helpers to drop by daily. Another is to move into small communes. At residences connected to The Green House Project, a dozen elders maintain independent, private rooms but share kitchens, dining areas and other common spaces in the facility.
SO … WHAT IS OLD? LET’S RETHINK AGING
“We want to change how people think about aging — that it’s not based on a number, but on a person’s contribution and living the way he or she wishes regardless of age,” Sternheim says. Here are small, yet impactful, ways to further that mission. 1. “What do you want to do next?” Life expectancy for the average American has rocketed up to 78.8 years old. That means today’s retirement age — partial benefits are available after 62 years old — isn’t an expiration date; rather, it’s another milestone, marking the start of a second career, an adventurous period of global travel or the continuation of a cherished hobby or academic classes.
[ph] 2. “Thanks for watching the kids tonight!” It’s true that 60 million Americans receive monthly checks from Social Security. But not participating in the formal workplace doesn’t mean that older people are lazy. Just the opposite, in fact. “Grandparents play a critical role in the overall family’s responsibilities,” Sternheim points out. For one, they are often very involved in their grandkids’ lives, helping their adult children juggle work and family. During a prolonged illness, one spouse often cares for the other. And there are plenty of older adults who volunteer their time to causes they care about. “They’re not just sitting back and watching the Social Security check come in,” Sternheim stresses. 3. “What was it like to live through the Summer of Love?” There’s no wrong way to ask about elders about their past life experiences, says Newburn. Questioning about specific events in history — “Did you watch or listen to the JKF-Nixon debate?” — or asking about life in general, pre-internet, are useful ways to bridge the generational divide. 4. “Here, I’ll set you up with a Facebook account.” When we think of mentorship, we usually visualize a sage, older tutor imparting career advice to a younger colleague. But the exchange can go both ways, in what Newburn calls “reverse mentoring.” Young people proficient in the latest technology can teach their elders how to use FaceTime, upload pictures to Facebook or sign up for online classes. Sometimes, it’s a matter of starting with the fundamentals: bookmarking a few favorite sites or marking the buttons for brightness and volume.
By tweaking our expectations of what older folks are capable of, and what they’re interested in, we can help eliminate unfair stereotypes. After all, one day we’ll all be there.
There are some unlikely residents at the Judson Manor Retirement Community in Cleveland, Ohio: millennials.
Thanks to an innovative program from the Cleveland Institute of Music, three students get to stay rent-free at the center in exchange for monthly performances.
But as you can see in the video below, these youngsters aren’t just saving money and practicing a little Bach, they’re also making a difference in the lives of older adults. ALSO:This Unique Education Initiative Connects Lonely Seniors to Chatty Teens
Music is not only a form of entertainment, it also has healing powers. As AgingCare.com points out, music therapy can help with numerous conditions, including Alzheimer’s, chronic pain, Parkinson’s and more. For example, music can help an aging adult who is struggling with memory loss, because familiar melodies helps them recall past events.
“The young people do a lot for us,” a Judson Manor resident tells the CBS Evening News. Another adds, “They bring us alive!”
There should be more programs like this around the country.
[ph] DON’T MISS:These Autistic Students Struck a Beautiful Friendship With Local Seniors
Once the kids are raised, some moms plan to enjoy a bit of well-deserved free time. But Carol Harr didn’t view her empty nest as a chance to relax. Instead, after raising her daughters in Centennial, Colorado and retiring from the state’s labor department, she decided to sell her home and become a full-time roving volunteer.
The 64-year-old Harr sold or donated almost all of her possessions, keeping just a few things in a storage unit. The remainder fit in her car, which she has driven to Florida, Georgia, and back to Colorado on volunteering missions for The Catholic Worker Movement, a social justice charity serving the poor, and World Wide Opportunities On Organic Farms (WWOOF), an organization that connects volunteers with organic farmers.
The radical change in lifestyle from settled mom to nomadic volunteer was prompted by a personal tragedy. Five years ago, one of Harr’s daughters gave birth to a baby girl who died after living for less than a day. “It was a real awakening for me,” Harr told Claire Martin of the Denver Post. “I’d been living my life for the future, spending my time cleaning up from last week and getting ready for next week. I took an ecumenical class called ‘Just Faith,’ about social justice, and began learning about living in community.”
Harr lives off her state pension while staying in housing provided by the various charities she volunteers with or with friends. Now that she’s back in Colorado on a WWOOF post, she’s staying with couple in Denver who agreed to host a volunteer.
Harr’s current post lasts through October, and for her next project, she’s invested in a plan to band together with others to create a co-housing community on the site of a former Denver convent — a good base for her plan of living light and volunteering.
Harr’s daughter Kati Harr told the Post, “I loved my childhood home so much, (but) even more important than my nostalgia is actively supporting my mom’s innate and deeply rooted desire to help her community and fellow beings. I really feel the route to happiness is walking within your values, living in a way that upholds the things you hold to be the most dear. My mom is a shining example of this. I am so lucky and blessed to be her daughter.” MORE: Meet the Man Who’s Putting Dry Socks on the Feet of the Homeless
As the baby boomers begin entering their golden years, the United States is bracing for a retirement crisis that could change the system entirely. Longer life expectancy, rising costs of living, soaring health care expenses and an unstable public safety net could mean the next few generations are in for a bumpy ride when it comes to retirement.
In fact, about half of the country doesn’t have the savings to be able to maintain their current standard of living after retirement, Marketwatchreports. The Boston College Center for Retirement Research’s “National Retirement Risk Index,” which measures the portion of the population that can expect to be financially comfortable in retirement, found that number jumps to 60 percent among low-income workers, but hangs at 40 percent among higher-paid workers — painting a pretty bleak picture for Americans.
On the other side of the world, however, Australia has found a solution to ensuring a stable retirement for its citizens — and Americans should pay attention. Currently, more than 90 percent of employed Australians save for their golden years, representing an estimated $1.6 trillion in savings for the nation’s economy as of June 2013, the consulting firm Deloitte found.
But it wasn’t an overnight change of behavior for the Aussies. In fact, Australians shared the American sentiment about retirement until 1992, when the government created a mandatory savings program that required employers to contribute 9 percent of an employee’s salary to a retirement account for workers between 18 and 70.
“Only a few people received good retirement programs — people who worked for companies or the public sector,” said Jeremy Duffield, chairman of the Australian Centre for Financial Studies, an academic think tank. “Large groups of the population had no coverage at all.”
The “Superannuation Guarantee” program enables employees to pick which fund they want to invest their cash in, similar to a mutual fund or a public-sector group, the National Journal reports. The three-pronged system also relies on voluntary savings, which only around 20 percent of people take advantage of, and a means-tested government pension program similar to the U.S. Social Security system. Susan Thorp, the chair of finance and superannuation at the University of Technology in Sydney, estimates about 75 percent of Australian senior citizens take advantage of at least a partial means-tested pension.
In recent years, the Australian government has amended the program, with a schedule increase of the employer contribution, upping it to 12 percent by 2020, while eligibility for a means-tested pension will rise from age 65 to 67 over the next decade.
But Thorp estimates Australians between age 60 and 65 have around $170,000 in Aussie dollars saved in these compulsory accounts. Americans could stand to benefit from a model with a mandatory component like the Superannuation Guarantee, as only about half of U.S. workers receive retirement coverage through employers or institutions.
The Australian program also includes stringent rules about withdrawing money from the superannuation, which subsequently leads to a comfortable nest egg as residents head toward retirement. Meanwhile, the United States 401(k) model allows Americans to break into the account prematurely to pay off loans or in the wake of unemployment.
But much like our 401(k), the superannuation program comes with financial responsibility and individual choice. And that’s one area that Australia could stand to improve. Duffield points to a low financial literacy rate among Australians, who may not be paying attention to how their money is invested and the fees that apply.
But financial literacy aside, one of the biggest challenges in implementing the system is political will, which could pose a problem with gridlock and partisan attitudes gripping Congress. But it’s something that politicians need to look at seriously, as more Americans begin to retire. After all, as Australia has demonstrated over the last 22 years, committing to a plan can pave the way for a better future — one that’s more golden than the current outlook here in the United States.
As America prepares for the baby boomers to enter their golden years, it’s disturbing to hear that only 18 percent of Americans feel secure in their retirement, according to a study by the Employee Benefit Research Institute. Enter Connecticut and its plan to research ways to help create a comfortable retirement for its private-sector employees. State lawmakers recently dedicated $400,000 toward the exploration of a potential private-sector retirement plan. Why is the government so interested in these employees? Perhaps it is because 740,000 of the state’s residents currently are not able to have a retirement plan through their company. The goal of the research is to develop a plan that would set up retirement accounts for the private-sector employees, which would be filled with money automatically deducted from their paychecks. For a small fee, these accounts would be monitored — and there would be an assured rate of return. However, not all of Connecticut’s lawmakers are in support of the plan. Opponents argue that this would interfere with the functioning of Social Security and other federal laws, or it would put more of a burden on taxpayers. These concerns are all things that need to be considered and addressed during the research. Connecticut may be the first state to commit money to the project, but it is not the first to toy with the notion. In 2012, California passed legislation to establish a similar program, but they are still in the process of raising funds. The hope is that by 2016, 7.4 million people will be served by a plan. Additionally, Illinois, Maryland, and Washington all looked into the option, but have not developed anything. While Connecticut is only committing itself to research, this is still a step forward and may encourage other states to follow suit.
