There is a movement afoot to put state governments in the business of offering retirement plans to private citizens, which would ultimately eliminate opportunities and siphon business away from financial professionals.
Lawmakers in several states have proposed that states create government-run plans for private sector workers. While the details differ from state to state, every proposal this year would require employers who do not currently offer a plan to adopt a state-run plan, either in direct competition with the private sector or, in some cases, squeezing out the private sector — including financial professionals — altogether. Proponents claim they are solving a crisis where people are not saving enough for retirement because there is a lack of access to affordable savings options. While we all want to see greater participation and savings rates, it makes no sense to create tax-payer supported government-run plans when there is already a robust, readily available array of affordable retirement savings options in the private marketplace. Different financial professionals have different product preferences, but we all know that competitive options exist.
