In a win for Californians saving for retirement, the U.S. Supreme Court has decided not to hear a challenge to the AARP-backed CalSavers state-facilitated retirement program. The program automatically enrolls workers who work for employers with five or more employees in a state-facilitated savings program if their employer doesn’t offer a private option. Though workers can choose to opt out, the program opens retirement savings options to millions of Californians who wouldn’t otherwise have them.
The nonprofit Howard Jarvis Taxpayers Association filed a lawsuit in 2018 alleging that the CalSavers program violated federal law. A district court dismissed the suit in 2020, and a federal appeals court upheld that decision after AARP and AARP Foundation filed an amicus brief with several other organizations in support of CalSavers. The Supreme Court announced on Feb. 28 that it wouldn't hear an appeal, which means the lower courts’ decisions will be upheld.
California is one of 14 states that have passed legislation enacting state-facilitated retirement savings programs. AARP is pushing more states to adopt such options, since our research shows that people are 15 times more likely to save for retirement when they can do so at work — and are 20 times more likely if their workplace savings is automatic.
This post was first published on March 4 and updated March 17 with more information about the Supreme Court's decision not to hear the appeal.
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