LANSING, Mich. (Michigan News Source) – If your employer doesn’t offer a retirement plan, Democrats in the Michigan Senate have a proposal that could change that – by having the state step in.

On June 17, the Democratic-led Senate narrowly approved legislation creating the Michigan Secure Retirement Savings Program, a state-managed retirement savings system for private-sector workers whose employers don’t already offer a qualified retirement plan. Employees would be automatically enrolled but could choose to opt out.

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Employers without retirement plans would be required to facilitate payroll deductions into the program. Those who refuse to comply could face misdemeanor charges and fines of up to $5,000.

A retirement nudge – or just another government mandate?

Supporters say the plan addresses a real problem. According to Senate fiscal analysts, about 42% of Michigan private-sector workers lacked access to an employer-sponsored retirement plan in 2022. Backers argue the program could help more residents build retirement savings while reducing future reliance on taxpayer-funded assistance. Similar “auto-IRA” programs already operate in more than a dozen states.

Republicans weren’t convinced.

State Sen. Thomas Albert (R-Lowell) argued that while encouraging retirement savings is a worthy goal, the legislation adds another layer of government regulation for businesses and shifts responsibility away from individuals, saying people already have the ability to open retirement accounts on their own.

The bills now head to the Republican-controlled Michigan House, where their future remains uncertain.