‘Hawaii Saves’ retirement fund moves forward with opposition from insurers
HONOLULU (HawaiiNewsNow) - A proposal to create a Hawaii retirement savings program for local businesses is moving forward in the state Senate.
The program, called “Hawaii Saves,” would be overseen by the state and is supported by AARP.
Some businesses strongly support the idea.
Liz Watanabe, owner of Burgers on Bishop in Downtown, wants to provide a retirement plan for her six employees, but right now she can’t afford the money or time to do it.
"Not only are we a new business, we are so small and taking another expense is just not feasible," said Watanabe.
“I don’t think it’s on my to do list right now, but I do think about how much of my paycheck I’m going to have to start taking out.”
But insurance companies say the idea is a bad one.
“We are very concerned that the plan will create risks for small employers and ultimately for the workers themselves who are putting their hard-earned savings aside for retirement,” said John Mangan, regional vice president for the American Council of Life Insurers.
Under the proposal, the state would not contribute to the IRA plan.
The money for the fund would come from the workers and overseen by a state board.
Barbara Kim Stanton, AARP’s state director, said the state’s oversight expenses for the plan would be minimal and that any money the state puts in are loans that would be paid back.
"I think they (the insurance industry) are looking at this as competition and you know there is nothing wrong with the consumers having choices," she added.
Senate Bill 1374 passed the Ways and Means Committee on Monday and moves on the full Senate.
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