Lawmakers Look at State-Sponsored IRAs for Private-Sector Workers
California Senate President Pro Tem Kevin de Leon’s “second mother,” his Aunt Francisca, spent most of her 74-plus years cleaning houses for people who had pensions through their employers or were wealthy enough to set aside money in their own retirement accounts.
Aunt Francisca has neither, only Social Security. At an age when many people retire, she had to keep working until just recently, when she suffered a minor stroke. De Leon now helps support her.
“It’s not a unique story,” de Leon, a Democrat from Los Angeles, said. “It’s the story of tens of millions of Californians and people across America.”
His aunt’s story inspired de Leon to push a state plan to require California businesses that have five or more employees and offer no other retirement plan to deduct 3 percent of their workers’ wages. If the plan takes effect the way he envisions, the money would be deposited in accounts supervised by a state board and invested for the workers’ retirement.