MCN Announces Support of the Minnesota Secure Choice Retirement Act
The Minnesota Council of Nonprofits (MCN) is a membership organization with over 2,100 charitable organizations that employ thousands of people across the state and provide services to millions of Minnesotans, including low income seniors with little retirement savings.
On Thursday, April 6, Minnesota Public radio reported on a growing problem of seniors becoming homeless. The history of retirement savings and nonprofits is a story of coming late to the game, and often suffering the consequences.
Nonprofit employees were the last employees included in the Social Security system, and it was not until 1983 that nonprofit employers were required to contribute to their employees Social Security accounts.
Since that time there is been a broad effort to encourage nonprofits to contribute to employee retirement. Every two years MCN publishes the Minnesota Nonprofit Salary and Benefit Survey, which reports on the extent to which organizations provide a retirement savings plan for their employees.
Minnesota nonprofits now employ 11.5 percent of the states workforce, over 310,000 people.
Like many other employers, larger organizations are the most likely to provide a retirement savings plan. 82 percent of nonprofits with budgets under $200,000 provide no retirement savings,
Many nonprofits have a small firm size, so that 55 percent of MCN’s 2,100 members and budgets under $400,000. These are organizations that are not big enough to have an HR director on staff, so the technical aspects of creating 403(b) retirement plans are beyond the management capacity or time of their boards and staff.
For MCN, our support for the Minnesota Secure Choice Retirement Act is twofold:
- First, there is strong interest within the nonprofit sector to make sure that nonprofit employees have adequate retirement, and
- Second, broad support to make sure all Minnesotans have access to effective means to say for the retirement, whether or not it is provided by their employer.
The Minnesota Secure Choice Retirement Act would help address a serious need of nonprofit employers by minimizing the barriers and increasing access to retirement plans at work.