Colorado is moving forward with its automatic-IRA program, seeking bids beginning this week from investment and plan consultants.
Last year, the state passed legislation to establish the program, after spending a year considering different approaches to expanding retirement plan access. It is one of a handful of states to begin implementing public retirement-savings initiatives for private-sector workers. Three auto-IRA programs are live, including those in Oregon, Illinois and California.
All three of those states, which have a similar “Secure Choice” design, have hired Ascensus as their record keeper. That firm, which has a major presence in the 529 College Savings market, has numerous relationships with different states for those programs. Later this year, however, Oregon will switch to BNY Mellon as its program administrator, according to information from Georgetown University’s Center for Retirement Initiatives.
On the investment side, State Street Global Advisors has been winning business among the state IRA programs. It is included as a manager in the California, Illinois and Oregon programs, Georgetown CRI data show. BlackRock and Charles Schwab are also managers in Illinois’s program, and Newton Investment Management is the ESG manager for CalSavers.
AKF Consulting is the program consultant for CalSavers, Illinois Secure Choice and the forthcoming systems in Maryland and Connecticut, Georgetown CRI data show.
Colorado’s program would apply to businesses with as few as five employees, requiring companies to participate and automatically enroll workers, unless they already provide retirement plans. The program’s board met last month to approve issuing requests for proposals. Bids are due April 30.
The three auto-IRA programs that are active today represent about $128 million in assets, according to data from Georgetown CRI.
Last month, the Department of Labor reversed its opposition to state-sponsored auto IRA programs. It withdrew support for a court brief submitted during the Trump administration that backed legal claims filed by a conservative tax group against California, over that state’s program.
The post Colorado seeking investment, plan consultants for auto-IRA appeared first on InvestmentNews.
As our second lead editor, Cindy Hamilton covers health, fitness and other wellness topics. She is also instrumental in making sure the content on the site is clear and accurate for our readers. Cindy received a BA and an MA from NYU.