While the underfunding of Kentucky's public-pension plans is getting some needed attention, about 795,000 Kentuckians work in private-sector jobs that offer no retirement plans at all.
During Tuesday night's debate at Centre College, the candidates for governor were asked what they would do to help employees of small businesses save for retirement.
Republican Matt Bevin and Democrat Jack Conway responded by talking about their ideas for creating jobs and helping small businesses cut through red tape.
But AARP, one of the sponsors of the debate, has something more specific in mind — something that the legislature and next governor should seriously consider.
A way is needed for private employers, especially small businesses, to offer their workers the option of saving through a tax-deferred payroll-deduction plan, similar to the 401(k) plans offered by larger employers.
A bill was introduced during this year's General Assembly to create an optional payroll deduction Roth IRA program for private employers.
The idea should pick up steam next year.
Legislatures in many states are considering private-sector retirement savings plans. Illinois lawmakers enacted one this year, though it must clear hurdles — related to federal law and protecting the state and employers from liability — before taking effect in 2017.
Fortunately, there also is interest in Washington. On Sept. 29, the U.S. Government Accountability Office issued a report on how Congress could help states expand private-sector retirement coverage by granting them greater flexibility under federal law.
As the GAO recognized, the need is urgent. About half of private-sector workers lack access to a workplace retirement plan. "Lower-income workers and those employed by smaller firms were much less likely to have access to programs. However, among those who had access, the majority of these workers participated."
Research confirms what common sense tells us: Workers participating in a payroll deduction plan are far more likely to save than those who have to do it on their own.
Pooling the savings would enable state plans to take advantage of economies of scale and compete for good returns on investment.
The average Social Security retirement benefit is just $1,300 a month.
Unless workers have a way to save for retirement today many more will struggle and depend on government in their old age.