Vermont Plans to Partner with Colorado on State Auto-IRA Retirement Plan

Vermont Treasurer Mike Pieciak has said the state will work with Colorado to help establish the state-facilitated auto-IRA retirement program, VT Saves, to address the issue of access to retirement plans for private sector workers whose employers do not offer plans.

Vermont and Colorado will negotiate a partnership agreement to launch the program by the end of the year, Pieciak said in a news release.

“Partnering with Colorado will lower costs, help achieve better returns, and position VT Saves to launch sooner,” Pieciak said in the release. “Many Vermont workers without a retirement plan are not saving a penny for retirement. This partnership will be an important step forward in expanding retirement coverage and supporting financial equity in our state.”

VT Saves is an automatic individual retirement savings plan, allowing savers to contribute via automatic payroll deductions, similar to a 401(k) plan.   

Employers with five or more employees who do not already offer a retirement plan will be required to participate in VT Saves, according to the release.
Employees in the program will automatically have a Roth IRA established; employees can leave the program at any time; and will always have access to any assets they invest without tax or penalties, explains the press release.

In 2023, Vermont changed the state program from a voluntary multiple employer plan, which was enacted in 2017 to an auto-IRA program, according to the Georgetown University Center for Retirement Initiatives.

VT Saves became state law in a unanimous Senate vote last year, adding Vermont to the number of states which have enacted a public auto-IRA program.

The Colorado program, Colorado SecureSavings, was launched in 2023 and currently enrolls more than 14,000 employers and has accumulated more than $50 million. Similar programs, in Maine and Delaware, have also partnered with Colorado on their state auto-IRA programs. Those programs are being administered by digital 401(k) provider Vestwell.

Three new auto-IRA programs were enacted in Minnesota, Nevada and Vermont and one new multiple employer plan in Missouri, last year.

State retirement savings programs have accumulated more than $1.26 billion in retirement assets, as of the latest data available from the Georgetown University Center for Retirement Initiatives.