Unlike some retirement plans that can be complicated to roll over, Vermont Saves accounts will follow individuals from job to job.

“Vermont Saves will help working Vermonters save for their future and retire with dignity,” said Treasurer Mike Pieciak. “People with access to a retirement plan through their employer are 15 times more likely to save, but nearly 100,000 Vermont workers—disproportionately women and [black, indigenous and people of color] Vermonters—aren't offered a workplace retirement plan. At no cost to employers, Vermont Saves will help more Vermonters save for retirement and take pressure off our state budget over time.” 

Pieciak continued, “I’m grateful to the Legislature and Governor [Phil] Scott for their unanimous support of this initiative. I also commend Becky Wasserman, our Director of Economic Empowerment, and the rest of our team for launching this program.” 

Wasserman said, “We have been committed to launching the Vermont Saves program as quickly as possible so Vermonters who have historically not had access to retirement savings are now empowered to have a more financially secure future.”  

Employees can set their own contribution rate or use the program default, which is set at 5%. Each employee can choose from a menu of investment options or be enrolled by default in a target-date fund based on their age. Savers can always access any principal funds they put into their Vermont Saves account or opt out of the program at any time if they choose. 
Eligible employers have already begun receiving information about enrollment by email or mail. Employers who already offer their workers a retirement plan, or who have fewer than five employees, are not required to enroll. 

Similar programs are already operational in several states, with over $1.6 billion in assets and participants averaging about $2,000 per year in savings. Last year, Treasurer Pieciak announced a partnership with the Colorado SecureSavings Program to join the Partnership for a Dignified Retirement, an interstate consortium including Delaware and Maine.

Related: Rhode Island, partnering with Connecticut, to launch auto-IRA program in 2025

The partnership has helped Vermont Saves launch ahead of schedule and will reduce costs of the program. Vermont officials say they expect that the partnership with Colorado will result in greater total assets under management, which in tun would lead to economies of scale and reduced costs—and therefore higher returns.

Vestwell, a third-party administrator, will run the Vermont program in coordination with the state’s treasury, adding to the firm’s list of 10 other state-facilitated automatic IRA programs that includes Connecticut, Rhode Island, New Jersey and Oregon.