CalSavers Retirement Savings Board reports growth and future plans for California program

The California Secure Choice Retirement Savings Board, known as CalSavers, is making strides in helping workers save for retirement, but challenges remain. During a recent Senate Budget and Fiscal Review Subcommittee meeting, Executive Director David Takartz provided an update on the program, which aims to facilitate retirement savings for employees whose employers do not offer a qualified retirement plan.

CalSavers operates on a simple principle: automatic payroll deductions. Workers are enrolled by their employers, allowing them to save without having to make a decision each pay period. The program is designed to help low- to middle-income earners accumulate wealth for retirement, with current participation exceeding 550,000 funded accounts and over $1.2 billion in assets under management.

A significant change is on the horizon. Starting December 30, 2025, the program will expand to include employers with as few as one employee, potentially tripling the number of businesses required to participate. This expansion aims to reach more workers who previously lacked access to retirement savings options.

However, the program faces scrutiny regarding its effectiveness. Currently, only 58,000 employers are actively facilitating contributions, and compliance issues persist, with hundreds of employers out of compliance. The program's sustainability is also in question, as it was initially expected to be self-sufficient within three years, but projections now extend that timeline to ten years, with a target of $6 billion in assets under management.

Senators expressed concerns about outreach strategies, particularly to low-wage workers who could benefit most from the program. Takartz emphasized the importance of engaging employers, as they control the payroll process, but acknowledged the need for broader outreach to workers themselves.

As CalSavers continues to evolve, its success will depend on effective communication with both employers and employees, ensuring that more Californians can secure their financial futures through retirement savings.