Comptroller Sean Scanlon (opinion): We can close the retirement gap

This artwork by M. Ryder relates to savings/retirement woes.

This artwork by M. Ryder relates to savings/retirement woes.

M. Ryder / M. Ryder/Tribune

I often wonder how my parents did it. My dad, a retired police officer, painted houses for a living. My mom stayed home with me. It’s somewhat staggering to think today, but in the 1980s, a single and relatively low-income household could qualify as middle class. They certainly didn’t have a lot, but they got by.

Then, like many family stories, a life event fundamentally changed things. When I was 6 my parents divorced, and my dad moved back to New York, where he was from.

My mom, now a single parent with no college degree and no recent work history, made and sold crafts for money before starting her own small business. She worked long hours, and I wouldn’t have had the fortune of being Connecticut’s new state comptroller had she not pushed herself to the limit to provide for me every day growing up. Her priority was keeping the lights on and food on the table, not saving for retirement.

While she doesn’t look it and hates to admit it, she has now reached retirement age and has no choice but to continue working for the foreseeable future. Retirement, for her, is simply not an option.

Sadly, my mom’s story isn’t an uncommon one in Connecticut or nationwide. Numerous studies have shown that more than half of Americans haven’t saved enough for retirement.

Part of that is life circumstances; 63 percent of Americans live paycheck to paycheck, according to a 2022 LendingClub report. Part of that is financial illiteracy; a lack of basic knowledge of banking and saving — let alone the stock market — and investing, is a widespread and growing problem. Part of it is generational; millennials like me are the first generation to be worse-off financially than our parents, and many are consumed with student loan and credit card debt that makes saving nearly impossible.

But the biggest part is this: over 630,000 people — nearly half of the workforce — in our state are employed at jobs that do not offer a retirement plan. And that’s a problem because, without an automatic payroll deduction, most people simply don’t save for the reasons discussed above.

How can we fix this? Thanks to a new program managed by the Office of the State Comptroller called MyCTSavings, we can close the retirement gap in Connecticut and ensure all workers have access to a retirement account, even if their employer doesn’t offer them one.

It’s a simple process: employers with five or more employees tell the comptroller’s office whether they offer a retirement plan and provide us with the names of their employees if they don’t. We then create a Roth IRA for them, the employer sets up the payroll deduction, and we handle it from there while managing their investments. It’s quick to set up, costs the business nothing, and gives employees the tools they need to succeed when it comes to saving. If they don’t want the account, they can close it at any time.

We’re coming up on a big milestone in the program. On March 30, all qualified Connecticut employers must respond to our request for information. Our message is simple: help us help your employees.

While I remind my mom and her fellow Baby Boomers, it’s never too late to save something for retirement, for many others, now is the time to start saving and, thanks to MyCTSavings, hundreds of thousands of people will have an easier time doing so.

Sean Scanlon is comptroller for the State of Connecticut.