The lack of retirement savings accounts at work for private-sector workers — only about half are covered by an employer-sponsored plan at any given time — and the fact that few workers save for retirement on their own has led to several states launching their own plans, auto-IRAs sponsored by the state that automatically enroll workers.

Oregon was the first state to launch its plan, and according to a brief from the Center for Retirement Research at Boston College, workers are responding positively.

Initial data reveal that although the plan itself has a few rough spots, workers are taking advantage of the plan in a way that looks promising for the future—and also perhaps for the future of similar plans in other states.

The OregonSaves program intends to provide a retirement plan for more than a million workers whose employers do not offer retirement plans, who are not eligible for the plan that their employers provide or who are self-employed and have no plan on their own.

The first rollout has been for the first group, amounting to approximately 500,000 workers, with the other two groups allowed to opt in. Data on the second and third group, however, are not yet available.

And while employers registered for the program, with many smaller employers actually registering early, it's another story when it comes to submitting employee contributions promptly. According to the brief, many of those small employers are likely to be managing their payrolls manually rather than electronically.

OregonSaves is designed with an initial contribution rate of 5 percent, auto escalation at 1 percent annually till it hits 10 percent and low fees on investments, and researchers wanted to see how participants reacted.

Predictions, based on participants in other 401(k)s, anticipated “opt-out rates of 20-30 percent and a tendency to stick with default contribution rates.”

Data from the plan itself found that 62 percent of those eligible to participate were doing so, while 29 percent had formally opted out.

Another four percent set initial contributions to zero before making an initial contribution and five percent had made some contributions but subsequently set contributions to zero.

Altogether, approximately 22,000 participants in the plan who had balances as of November 30, 2018, held assets of more than $10 million. In addition, participation is growing, adding nearly 2,000 active participants per month during 2018.

Older workers were slightly more likely not to participate, either because they could save through a spouse's plan or because they were “less likely to be passive.”

There were three main reasons for non-participation overall; 30 percent said they didn't have the money, 19 percent had their own or another retirement plan and 12 percent didn't want to save through that particular employer.

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