State Treasurer Ted Wheeler tells legislative committee that Oregon seniors are facing 'generational' retirement crisis

A dire lack of retirement savings among many Oregonians should be addressed with a state-sponsored plan aimed at boosting savings for those who now have none.

Oregon Treasurer Ted Wheeler delivered that message Monday morning to a joint legislative committee meeting as three days of hearings of deliveries of interim reports kicked off at the Capitol in Salem.

Wheeler, who has chaired the Oregon Retirement Savings Task Force for the past eight months, pulled no punches in outlining the scope of the problem.

The state is facing a "generational crisis," he told members of the House and Senate revenue committees -- one capable of plunging thousands of senior citizens into poverty.

Currently, he said, more than half of Oregon's adults have less than $25,000 set aside to cover the costs of retirement. One quarter have less than $1,000 available.

Wheeler contrasted that by saying a sound goal for retirement entails people setting aside eight times the amount of money they earned in their final year of regular employment.

Instead, the trend is moving in exactly the opposite direction, he said, as the number of number of people with access to company-sponsored pensions and other retirement-oriented savings continues to dwindle.

It's that growing gap between expectations and realities where a state-sponsored program can be critical, Wheeler said.

The seven-member task force looking into the problem generally agrees that Oregon should move ahead with a plan for workers who lack access to a plan at their workplace.

Only one task force member, Wheeler noted, objected to the state stepping into that role.

The task force has come up with nine recommendations to formulate what he described as a "basic" retirement-security plan.

As envisioned, the plan would be voluntary, with an auto-enrollment feature. That means all eligible people would be automatically enrolled. They could then opt out if they didn't want to be covered.

Other recommendations include:

--Defined contributions should be made from employee payroll deductions.

--Accounts should be individual and account information should be made regularly to each participant.

--Accounts should be portable, meaning employees could take them from job to job.

Committee members seemed to favor most aspects of the proposal, which is likely to be forwarded to the 2015 Legislature for adoption.

Rep. Tobias Read, D-Beaverton, said it seems to present considerable opportunities for the private financial sector to help future savers.

Rep. Jessica Vega Pederson, D-Portland, had her own take on the task force's findings that women and minorities tend to save less for retirement than the population as a whole.

Citing a recent study on the topic, she noted that women participate in retirement plans at roughly the same rate as men, but due to various factors, they earn less money and therefore contribute less to their own retirements.

After the hearing, Wheeler said the task force will now move ahead with more "market research" on what a final recommendation needs and reach out to small businesses to determine what their role should be.

"Really," he said, "this is just the beginning of a long fact-finding mission."

-- Dana Tims

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