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The perils of state-run retirement plans
But is state involvement necessary? The question warrants scrutiny because state-sponsored individual retirement accounts, or auto-IRAs, don’t actually fill a void. Traditional and Roth IRAs already proliferate in the private sector. They can be set up at local financial institutions or online, and many don’t even require a minimum contribution. From start to finish, the whole process is relatively simple.
State governments jumping into the mix could prove harmful not only to private-sector IRA providers competing in the same arena but also — and more important — to the targeted employers and employees themselves.
Read the entire article here.
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The limited role for government in easing the retirement-savings problem
The U.S. Department of Labor just established a rule, which went into effect on Sept. 30, that allows unrelated employers, particularly small employers, to offer joint 401(k) plans. Indeed, unrelated employers in the same or similar business can band together no matter where they are located throughout the United States. Heretofore, none of this was permitted.
That’s encouraging for employers that on their own would shy away from offering a 401(k) plan for employees but may find it manageable when joining forces with other employers. Wisconsin’s Office of State Treasurer told the Badger Institute that the federal rule change is encouraging but cautions that more may be needed to solve the problem.
Read the entire article here.
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No need for state-run student loan refinancing
To be sure, student loan debt is a problem. The average Wisconsin college graduate carries around $30,000 in debt. As with saving for retirement, however, it begs the question whether government involvement is the solution given that private-sector options already exist.
Over 180 credit unions and banks from Marinette to Menomonie to Muskego offer student loan refinancing products and/or student loans, according to the Look Forward to Your Future project of the Wisconsin Department of Financial Institutions.
Read the entire here.
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