Chapter 29 Covering the Uncovered

As we have seen, the current retirement savings system “works” (for most workers, at least) where an employee is covered by a workplace retirement savings program, typically a 401(k) plan, into which he is defaulted at an adequate savings rate.

This way of stating the solution clearly raises a problem—what about employees that aren’t covered by a workplace retirement savings program? If we now live in a world in which most will have to begin saving for their own retirement, rather than depending on transfer payments from the succeeding generation, then these uncovered individuals have a high likelihood of retirement income “failure.”

How do we get these individuals covered? That is the issue we address in this ...

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