Though the U.S. is slowly recovering from the effects of the Great Recession, Washington small business owners and their employees are facing another financial crisis: retirement security. A survey by the American Association of Retired Persons (AARP) found a quarter of residents between the ages of 45-64 in the Evergreen State have less than $25,000 in savings, and additional research found nearly three in five middle class workers in the state can expect to outlive their retirement savings. Washington small business owners and their workers are no exception.
When it comes to employee benefits, the difference between working for a small business and a large corporation can be the difference between eating at a buffet and dining a la carte: neither are bad options, but one usually offers more choices than the other. Unfortunately, far too many lawmakers in Washington, D.C. fail to understand that small businesses often do not have the resources to offer a buffet of benefits, which can result in high employee turnover.
For small business owners, setting up an employer-sponsored retirement plan can be complicated and expensive. Too many small businesses don’t have the resources to create a formal retirement plan, which means entrepreneurs and their employees frequently struggle to plan for retirement. Nearly 80 percent of employees who work for a small business don’t have access to an employer-sponsored retirement plan.
As we enjoy the hustle and bustle of the holiday season, here at Small Business Majority we’re celebrating a very successful 2014. And with a new Congress coming to Washington in January, we’re looking forward to continuing our efforts on the small business front in 2015. See below for some of our biggest accomplishments from the past year.
The state House of Representatives’ recent passage of the Save Toward a Retirement Today (START) bill is a step in the right direction for Washington’s small businesses and their workers. START would help small employers by giving them the option of creating a simple, state-managed retirement account for their employees and themselves.