Set to launch in 2017, plan will level the playing field by allowing every Oregonian to save at work.
The Oregon Retirement Savings Plan is seeking market research and plan-design expertise to help construct the first-of-its-kind program, which will allow an estimated 600,000 Oregonians to begin saving for retirement at work, beginning in 2017.
The under-development plan will make Oregonians’ lives better — for small businesses, for workers and families, for taxpayers, and for the financial services sector, which will help nurture a new Oregon culture of saving. Today, roughly half of Oregon workers do not have access to an option to save for retirement through their employer, even though research says people are most likely to save and will save more when that opportunity is available.
With that in mind, the 2015 Legislature approved creation of the Oregon Retirement Saving Plan. The Oregon Retirement Savings Board, which was appointed by Gov. Kate Brown to oversee construction of the plan, on Tuesday discussed the newly released Request for Proposals for Market Analysis, Program Design and Financial Feasibility Services.
The RFP can be found on the State Treasury website and also is being distributed widely through the state’s contracting database. All qualified firms are invited to apply.
The deadline for responses to the request is Jan. 19, and a contract is expected to be awarded in February.
“The Oregon Retirement Savings Plan will help to level the playing field for Oregonians, because it will allow everyone an opportunity to save at work,” said State Treasurer Ted Wheeler, one of the architects of the program and chairman of the Oregon Retirement Savings Board. “The plan will be designed to serve the needs of Oregonians, and will help hundreds of thousands of people to start building more secure futures for themselves and their families.”
Retirement savings rates are lower among women, minorities and people with a high school education level or less. Insufficient retirement savings can force tough sacrifices, such as skimping on food, housing and health care.
Employers that currently don’t offer plans to employees — primarily small businesses — will benefit because the state-administered plan will offer an easy path to help their workers start saving, without a mandate for businesses to create their own individual plans.
In addition to allowing thousands of people to begin saving for retirement at work, the Oregon plan will help the state to cope with a crisis of inadequate savings. Less savings translates into more stress on public-financed safety net services, and many of those are already strained.
The board also discussed Tuesday the creation of working groups that will discuss, research and offer advice in connection with four key areas: Plan Design, Program Design, Financial Literacy, and Outreach.
The U.S. Department of Labor is mulling changes to federal retirement rules that would allow states more flexibility to create retirement saving options for now-unserved people. Other states that are advancing similar programs include California and Illinois.
The envisioned Oregon plan will not be a pension, will not be connected in any way to the Oregon Public Employee Retirement Fund, and will not offer any matching funds or any guarantee of performance by the state or employers. It will offer pooled and professionally managed investment options to Oregonians who are currently not being served by retirement plans such as 401(k)s.
The Oregon State Treasury protects public assets and saves Oregonians money through its investment, banking, and debt management functions. State investment policies are set by the Oregon Investment Council. The State Treasury also promotes public outreach and education to help Oregonians learn strategies to save money, invest for college and make smart financial choices.
