Saving for Retirement? Easy as I-R-A in Connecticut
Saving for retirement in Connecticut is as easy as I-R-A: the kind you can find in your local bank, or by calling an insurance broker, any time you want to get started.
Many employers also offer attractive, tax-deferred plans such as 401(k)s.
The issue of retirement savings in Connecticut isn’t lack of supply—there are plenty of options, led by attractive tax-free savings plans.
But state government wants to impose a different solution—and it involves the state expanding into an area outside its core function and expertise.
The state solution, as proposed in HB 5591, will put many workers into a retirement savings account that doesn’t offer tax-deferred savings and will take more out of their savings than that IRA they can get down the street.
And it will leave Connecticut employers with the cost and responsibility of administering the program, from enrollments to payroll deductions to plan changes.
This solution is not only a bad deal for workers, it puts state government in competition with the private sector.
Workers will have to pay taxes on their savings before it goes into their account. And it’s likely there will be an extra fee to help fund more bureaucracy to run the new program.
This solution is not only a bad deal for workers, it puts state government in competition with the private sector—which should not be seen as a good idea, considering the state of Connecticut’s economy.
At a time when the state should be looking at how to provide core services more effectively and efficiently, striking out into new territory is probably not the wisest decision.
HB 5591 changes things, but not necessarily for the better.
CBIA urges Connecticut state lawmakers to reject HB 5591 as too costly for workers and the economy.
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