Expand thrift programs such as saving for higher education, retirement and caring for those Californians with disabilities by providing accessibility of our capitalistic system’s forces for vulnerable persons.
An inevitable consequence of capitalism that produces larger economies is the exclusion of those who are less advantaged than others. The California Treasurer commits to developing and promoting thrift programs and financial education that activates the power of capitalism for all Californians.
CalSavers: Established in 2018, CalSavers is a retirement savings program for private sector workers whose employers do not offer a retirement plan. This program gives employers an easy way to help their employees save for retirement, with no employer fees, no fiduciary responsibility, and minimal ongoing responsibilities.
Nearly half of working Californians are on a trajectory to retire into economic hardship—if they can retire at all—driven largely by lack of access to a retirement plan at work. Too many businesses can’t afford the costs and liabilities of offering a private retirement plan and the industry has not found profit in serving this lower income market. Two-thirds of these uncovered workers are people of color and nearly 60 percent are women.
Designed with the insights of behavioral economics, CalSavers offers a path to retirement security for millions of workers who have been under-served for decades. By establishing a broad employer mandate in addition to providing a public option for employers, we are not only expanding access through those who choose CalSavers but also spurring innovation, competition, and expanded participation in the private market.
Following the program rollout period, CalSavers aims to enroll hundreds of thousands of actively contributing participants by 2023.
CalABLE: Established in 2018, CalABLE is a savings and investment plan offered by the State of California to individuals with disabilities that allows people with disabilities the opportunity to save and grow their money in tax-advantaged accounts without interfering with government benefit programs.
It is estimated that families that include a person with a disability must earn up to 28 percent more income in order to obtain the same standard of living compared to a family without a person who has a disability. CalABLE creates an opportunity for people to save, invest, and grow their money, and use that money to pay for the additional costs of living a life with a disability. In the disability community approximately four in ten report significant difficulty in handling an emergency expense as small as $400.
CalABLE aims to increase program enrollment by 250% by December 2030.