New Mexico could soon have a retirement plan for privately employed and self-employed workers after a bill to create an online retirement exchange passed nearly unanimously through the legislature and heads to the governor’s desk for her signature.
The New Mexico Work and Save Act would create an online exchange where workers who don’t have retirement accounts from their employers could set aside a portion of each paycheck for direct deposit to a Roth IRA. Small businesses that don’t have retirement options for employees could opt in.
One of the bill’s sponsors, Rep. Gail Armstrong (R-Magdalena), owns a convenience store in Magdalena. She said she intends to offer the state retirement plan to her employees, and especially wants to teach young workers about saving.
“A lot of times when you take the money out before they actually see it, they just sort of forget about it and it’s just put away. And then all of the sudden they have $500 saved,” Armstong said. She said there was little opposition this year after failed legislation from last year was changed to make participation voluntary for businesses instead of mandatory.
New Mexico has the nation’s highest percentage of employees without access to a retirement account with an automatic payroll deduction, according to the nonpartisan Think New Mexico. Legislative analysts say New Mexico would be the eleventh state to offer such a retirement program.
With approval from Governor Michelle Lujan Grisham, workers could open accounts in January 2022.
This story is part of the project: Your N.M. Government. Funding for our legislative coverage is provided, in part, by the Thornburg Foundation, the New Mexico Local News Fund and KUNM listeners like you.