This 401(k) alternative has helped US workers save more than $1.7 billion so far

By some estimates, almost half of US private sector workers — close to 57 million people, according to AARP — do not have access to a retirement plan at their jobs. That’s either because their company doesn’t offer one or because they don’t qualify to participate in an employer’s existing plan.

By some estimates, almost half of US private sector workers — close to 57 million people, according to AARP — do not have access to a retirement plan at their jobs. That’s either because their company doesn’t offer one or because they don’t qualify to participate in an employer’s existing plan. That is just one reason why policy experts see a retirement savings crisis on tap for so many Americans over the next several decades. But the advent of state-sponsored auto IRAs — individual retirement account programs that workers can be automatically enrolled in if their companies don’t have their own workplace plan in place — is helping to make a dent in that coverage gap. Auto IRAs are relatively new. The first one started in 2017, and now a total of 17 states have enacted their own, although only 10 are currently in effect, with a few others scheduled to come on line next year, per AARP. But, just based on data from eight states’ programs, more than 900,000 workers have already amassed savings of over $1.7 billion as of October, according to the Georgetown Center for Retirement Initiatives. And two new auto IRA analyses released this week — by the Pew Retirement Savings Project and by Gusto, a payroll and HR software provider for small and medium-sized businesses — found broad-based benefits, especially for low-to-middle-income earners, who are typically least likely to have access to workplace plans.