[MikefromCT]

Starting last year, Connecticut rolled out My CT Savings, a state-sponsored Roth IRA for anyone working in the private sector where their employer does not offer a retirement plan. I have a FT job that provides a 401k which my employer matches, but I also have a PT job on weekends where I decided to opt in and participate in this. It's a small holding and it won't amount to a huge amount, so it will constitute a tiny portion of my retirement holdings, but I decided to take advantage of it. Has anyone else enrolled in this? Other states have been doing this for years now (including MA, NY & NJ) so it's not unique to us. And personally, I think this is a great opportunity for anyone seeking to open a retirement plan — especially since we now know that we can't rely solely on Social Security.

Thoughts?

[davwve]

What are the advantages using the State program versus opening a Roth IRA directly with a brokerage such as Fidelity, Vanguard, or Schwab? The State program charges fees on top of the fund's expense ratios.

[SteveM85]

Roths have been around since the 90s through a variety of outlets.

[MikefromCT]

Originally Posted by SteveM85

Roths have been around since the 90s through a variety of outlets.

Yes they have, but I was inquiring specifically to the state-sponsored one.

[WouldLoveTo]

No thanks. What could possibly go wrong?

[SteveM85]

Originally Posted by MikefromCT

Yes they have, but I was inquiring specifically to the state-sponsored one.

It looks like it invests in Fideilty and Vanguard funds anyway
Just open a no fee Fidelity account and put the money in one of the Fidelity zero fee Total Market index funds like FZROX

[Stepfordct]

Is the State of Ct just reinventing something that already exists, or creating an extra value here??

[JayCT]

I believe the point of the state plan is that employers will be able to deduct the money paycheck automatically rather than an individual saving for an IRA. It opens retirement savings to small companies that otherwise would not be possible. Jay

[Stylo]

Originally Posted by SteveM85

Roths have been around since the 90s through a variety of outlets.

David Lee Roth has been well established since the late 70’s!

[davwve]

Originally Posted by JayCT

I believe the point of the state plan is that employers will be able to deduct the money paycheck automatically rather than an individual saving for an IRA. It opens retirement savings to small companies that otherwise would not be possible. Jay

Its nice that the State is promoting retirement saving but there isn't really much of an incentive to participate in this program vs spending the 5 minutes to set up a Roth with automated reoccurring transfers aligned with the individual's pay day. An individual would avoid the additional program fee drag on their portfolio. For those that lack impulse control to save I imagine having deductions straight from their payroll may help prevent them from making rash decisions with spending the funds on consumer items.

At least with the CHET program the State incentives with a tax deduction.