State lawmakers passed a bill Wednesday sponsored by Sen. Daniel Biss (D-Evanston) that implements a program to help Illinois workers save better for retirement.
The bill, which now heads to Gov. Pat Quinn for final approval, creates the Secure Choice Savings Program, a plan that automatically provides each worker statewide with a retirement account.
The policy deducts 3 percent of employees’ incomes and puts it into the accounts, unless they manually change it themselves. Instead of having to opt into a retirement plan, workers are already provided with a way to save money and can choose to opt out on their own.
“Retirement insecurity for private sector workers is a serious and growing problem with a surprisingly commonsense, intuitive solution,” Biss said in a news release Wednesday. “Illinois has taken an unprecedented step toward making retirement a financially viable option — for the first time — for millions of workers.”
The state Senate first passed the bill in April, but voted Wednesday to adopt multiple amendments that the House had added.
Biss made the policy in response to a statewide problem of employees trying to save money and their employers decreasing the amount of retirement benefits they offer, the state senator’s spokeswoman Katharine Eastvold told The Daily in November.
“Particularly low-wage workers, they’re living paycheck to paycheck,” Eastvold said. “They’re spending everything they make, they don’t know about various savings instruments, they are not financially literate … We’re going to have a crisis where people are coming to retirement age and they don’t have anything saved.”
Biss was named a finalist for the program in November in a innovative policy contest through the national network Developing Exceptional American Leaders. Known as NewDEAL, the organization selected Biss as one of the politicians to be a finalist in the New Ideas Challenge.
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