Editorial: New Mexicans need proposed retirement savings plan - Albuquerque Journal

Editorial: New Mexicans need proposed retirement savings plan

Today’s job prospectors want to know about benefits such as health insurance premiums and deductibles, maternity and paternity leave, vacation accrual and comp time. Living paycheck to paycheck focuses your attention on covering monthly bills rather than setting some aside for a nest egg.

And so, is it any surprise just 56% of N.M. workers age 50 or older have any retirement savings at all – and only 27% of them have stashed away $10,000 or more?

That’s likely in great part because 62% of New Mexico’s private-sector employees, about 336,000 workers, have zero, zip, nada access to a retirement savings plan through their employers, according to AARP. That lack of savings makes retirement a hard place in New Mexico, considering the average Social Security benefit in our state is just $13,900 a year, less than half of the $28,000 the U.S. Bureau of Labor Statistics says is needed for food, housing and health care.

If our retirees only knew then what they know now and had had an avenue to save a bit every paycheck.

House Bill 44, the New Mexico Work and Save Act, sets up a web-based method for future New Mexican retirees to help themselves. It creates voluntary state-sponsored Individual Retirement Accounts, similar to Roth IRAs, in which self-employed and private-sector employees could have payroll deductions placed into retirement savings plans. The cost would be minimal, as New Mexico would be able to join forces with any of the 10 states that already have adopted a similar setup, and modest fees capped at 1% are to ensure the system is self-sustaining within five years.

It’s not mandatory – businesses choose to participate, as do employees, who can determine how much to contribute from each paycheck, up to $5,000 a year. And we all know saving is easier if you don’t see that $5, $10, etc. in your paycheck; you don’t miss it. And as it accumulates in that retirement account, earning compound interest, the prospect of having to make ends meet on $13,900 a year becomes less likely.

The bipartisan bill cruised through the House by a 62-1 vote and is now in the Senate with just a week left in the session. HB 44 is a much-needed effort at preventing another generation of retirees from falling into poverty. The Senate should pass this bill and get it to the governor so more New Mexicans have the option to build their nest eggs through payroll deductions.

This editorial first appeared in the Albuquerque Journal. It was written by members of the editorial board and is unsigned as it represents the opinion of the newspaper rather than the writers.


Albuquerque Journal and its reporters are committed to telling the stories of our community.

• Do you have a question you want someone to try to answer for you? Do you have a bright spot you want to share?
   We want to hear from you. Please email yourstory@abqjournal.com

Nativo Sponsored Content

taboola desktop

MORE ARTICLES LIKE THIS

1
Editorial: Warming station a way station to a better ...
Editorials
Something divine is going on in ... Something divine is going on in Albuquerque's International District.
2
Editorial: 'Substitute' solution National Guard, state workers innovative idea
Editorials
The governor deserves credit for thinking ... The governor deserves credit for thinking outside the box when it comes to staffing up our K-12 clas ...
3
Editorial: Study paves way for more NM wildlife crossings
Editorials
Kudos to N.M. wildlife and transportation ... Kudos to N.M. wildlife and transportation officials for converting a sizable data-gathering project ...
4
Editorial: APS should learn it's not above open records ...
Editorials
APS should learn it's not above ... APS should learn it's not above open records law
5
Editorial: Dow backed ethics commission - until it investigated ...
Editorials
Shortly after taking office in 2017, ... Shortly after taking office in 2017, state Rep. Rebecca Dow joined other House members in a 66-0 vot ...
6
Editorial: Game Commission should serve public, not be rubber ...
Editorials
The New Mexico Supreme Court is ... The New Mexico Supreme Court is expected to decide, once and for all, whether a 2017 state wildlife ...
7
Editorial: Tax cut and DOJ plans have merit; but ...
Editorials
Lewis' proposed ordinance would strike existing ... Lewis' proposed ordinance would strike existing mayoral authority to order the closure of ...
8
Editorial: MLK was more than his famous 'Dream' speech
Editorials
Dr. Martin Luther King Jr. was ... Dr. Martin Luther King Jr. was a master of the soaring rhetoric of the conscience. His most thought- ...
9
Editorial: Governor, lawmakers have opportunity to join forces and ...
Editorials
There's not a lot of talk ... There's not a lot of talk in Santa Fe these days about expunging criminal records. Or legalizi ...