Move over, Congress: Let states do the right thing to help working families save for retirement

78 percent of baby boomers are more afraid of retirement than of death. Sound extreme? Not really. The median retirement savings for near-retirement households is $14,500. At least half of households are at risk of having insufficient resources to maintain themselves into retirement. And four in 10 people age 56–61 have nothing at all saved for retirement.

How can this be? There are a number of reasons, including the demise of private and public pensions and growing income inequality, which has shrunk the capacity of workers to save. But one cause is fairly easy to fix: millions of people do not have access to 401(k) plans or other savings options at their workplace.

What if people who wait tables, wash cars, take care of children, or perform other low-wage jobs for small businesses—which often don’t offer 401(k) savings plans—could have money taken out of every paycheck and deposited into a low-cost retirement savings account operated through the state government? Five states have enacted plans that are making this possible, and 28 states are at various stages of considering such plans. If all of these states did enact these laws, 63 million people could have access to retirement savings options.

This was the goal of the Obama administration, which put in place regulations to help states that wanted to provide retirement savings options. Though some states had set out on this path before, this new policy that made it easier and safer for states to offer these plans, paved the way for this positive development in the states.

This was great news for millions of workers! Make it easy for people whose employers don’t offer retirement savings option to do the responsible thing: put away money every month toward their retirement in a way that limits the amount of their savings that is lost to fees and commissions. It helps people prepare for their old age. It chips away at a looming retirement crisis. What’s not to like?

Well, apparently the people who collect those fees and commissions are not happy, and some employers would rather not have to bother, though the employees would fund these accounts out of their own paychecks, not employers.

Now Congress is moving to strike down the regulation. The House last week passed a bill to overturn it and the Senate will consider a similar bill soon.

When Washington can’t or won’t move to avert a looming retirement crisis, the least it can do is get out of the way and let states do the right thing for millions of working families across the country.