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Retirement Security

Can a publicly sponsored retirement plan for private sector workers guarantee
benefits at no risk to the state?

August 2012, by David M. Stubbs and Nari Rhee
» Press Coverage

Policy BriefThe California legislature is currently considering SB 1234, a bill that would create the California Secure Choice Retirement Savings Trust—a state-sponsored retirement plan for private sector workers who lack access to a workplace plan.  Assets would be managed in a pooled fund and workers would be guaranteed a rate of return on their contributions, insured by private underwriters rather than the state.  This policy brief broadly assesses the feasibility of such a plan by analyzing the private cost of guarantees, probable investment returns simulated through a hypothetical pension investment portfolio, and the long-term funded status of a hypothetical pension plan given conservative assumptions.


6.3 Million Private Sector Workers in California Lack Access to a Retirement Plan on the Job
June 2012, by Nari Rhee
» Press Release PDF

Policy BriefThis research brief finds that after more than a decade of declining access to employer-sponsored retirement plans in the private sector, millions of working Californians lack this critical pillar of retirement security. Given stark disparities in access by earnings, firm size, and race, most of these workers are low- to middle-wage, employees of small businesses, and Latinos. The brief also outlines the potential advantages of a publicly sponsored retirement plan for closing the private sector pension gap and helping low- and middle-income workers build adequate and secure retirement incomes.


Black and Latino Retirement (In)Security
February 2012, by Nari Rhee
» Press Release
» Press Coverage

Policy BriefThis research brief finds that Black and Latino seniors face even tougher times in retirement than American seniors as a whole, based on data from the U.S. Bureau of Labor Statistics Current Population Survey.




Meeting California’s Retirement Security Challenge through a State Sponsored Retirement Plan:
Policy Design Challenges and Options
February 2012, by Nari Rhee

RetirementThis paper outlines key choices in developing a state sponsored retirement system for private sector workers in California who lack access to a workplace pension. The first section briefly outlines the rationale for the creation of a publicly sponsored retirement plan. The remainder of the paper explores critical plan design choices that policymakers face within the constraints and opportunities afforded by two fundamentally different types of plan architecture: individual accounts such as 401(k)s and IRAs, and cash balance plans, a type of defined-benefit pension that limits employer risk and shares some of the characteristics of defined-contribution plans.


Potential Impact of Governor Brown's Pension Reform Plan on Low Wage Workers PDF
January 2012, by Nari Rhee
» Press Coverage

RetirementThis paper outlines the potential impact of Governor Brown's public pension reform proposal on low-wage workers employed by state and local government, focusing on two elements.  One is a “hybrid” pension proposal for new employees consisting of a smaller traditional pension benefit and a 401(k) type individual investment account.  The other is raising the normal retirement age for new non-safety employees to 67.  Low-wage workers are ill-equipped to bear the risks and increased costs of a 401(k) style plan, need to replace a greater portion of earnings than do middle- or high-wage workers in order to meet basic expenses in retirement, and begin their working careers much earlier, and experience shorter life expectancy, than professional workers. Because of these factors, the two reforms could impose disproportionate costs on workers at the bottom of the wage spectrum.  

Meeting California’s Retirement Security Challenge PDF
October 2011, by Nari Rhee, ed.
» Press Release PDF
» Press Coverage

Meeting California’s Retirement Security Challenge This edited volume brings together rigorous academic and policy research to outline California workers’ retirement prospects in the context of threats to Social Security, the decline of secure workplace pensions, and the shift to risky individual investment accounts like 401(k)s. In California, less than one–half of private sector workers have access to an employer sponsored retirement plan, and nearly half of all workers are likely to have retirement incomes that place them in or near poverty. There is also marked racial and socioeconomic inequality in life expectancy among California residents that persists at retirement age. Fortunately, state level policies can make it easier for employers and employees to participate in cost–efficient and secure retirement plans for workers who do not have an adequate pension.

Download individual chapters

  1. Introduction: The Coming Age of Retirement Insecurity PDF
    Jacob Hacker

  2. California Workers’ Retirement Prospects PDF
    Sylvia A. Allegretto, Nari Rhee, Joelle Saad-Lessler and Lauren Schmitz

  3. Life Expectancy in California’s Diverse Population: Recent Estimates by Race/Ethnicity and Neighborhood Social Class PDF
    Christina A. Clarke and Amal Harrati

  4. The Employer Case for Defined Benefit Pensions PDF
    Beth A. Almeida and Christian E. Weller

  5. Designing a More Attractive Annuitization Option: Problems and Solutions PDF
    Anthony Webb

  6. High Performance Pensions for All Californians PDF
    Teresa Ghilarducci

  7. Author Biographies PDF


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