Doing More in Delaware: the Advent of Delaware EARNS

This week, we are delighted to have conversations with Colleen Davis, the State Treasurer of Delaware, and Ted Griffith, the Program Director of Delaware EARNS. This dynamic duo are bringing to life the nation’s next Auto IRA program and the first such retirement security opportunity for the great state of Delaware. We can’t wait to see the unique thinking they bring to the space. Cool news ahead.

Treasurer Davis, you’ve been working on retirement security for Delawareans for some time – what does it feel like to be moving forward?

There’s a building sense of anticipation—excitement, actually. I started advocating for an automatic IRA solution for Delaware workers very shortly after I first came into office. It has consistently been among our highest priorities. So, it’s gratifying to see the progress our team is making. Gratifying to see an idea on paper start to become reality and gratifying to have the strong support we have received.

That’s support from legislators, the governor, other state agencies, the business community, nonprofit leaders up and down our state. And everyday workers who I meet in my travels who have been waiting for the chance to improve their financial security. We have nearly 150,000 private-sector workers in our state with no access to retirement savings through their employers.

We know that if you don’t have a plan through your job, the odds are overwhelmingly against you saving for your future. This is a crisis that must be addressed.

Ted Griffith, it’s exciting to introduce you to our RSM collaborative. What are some of your current priorities with the Delaware EARNS program?

Thank you. I’m honored to have this opportunity. In terms of priorities, a successful launch of the program, which we anticipate in early 2025, is at the top of our list.

To do that, we are working closely with the states of Colorado and Maine to potentially join an interstate consortium called - and I think this the perfect name - the Partnership for a Dignified Retirement.

By potentially joining this partnership, we greatly accelerate our time to launch, what would have taken two years can be done in a quarter of that time. We achieve economies of scale near term and long term. But perhaps most importantly, we benefit from working with people who have already successfully done this.

Colorado, as you know, has achieved rapid acceptance for its SecureSavings program among employers and employees. We’re looking forward to taking their successful playbook and modifying it for less mountainous, more compact terrain. Kidding aside, we do consider Delaware’s small size an advantage when it comes to reaching employers and employees.

Ted, what are some of the challenges you see in the near term?

I used to work at a large mutual fund company. One of our marketing executives liked to say: “You can have the greatest product in the world, but if nobody knows about it, what good does it do?” In the near term, our greatest challenge is building awareness for Delaware EARNS.

Our small size as a state makes that easier, but it is still a challenge to get people’s attention, get them focused on saving for retirement. We’re looking for innovative partnerships, not just the interstate alliance, but also collaboration with nonprofits and other state agencies here in Delaware to ensure employers and employees know what a great opportunity EARNS represents for them.

Treasurer Davis, how do you see this program fitting into Delaware’s work and focus on financial resilience?

I brought to this office a firsthand understanding of how important it is to help families and individuals build financial resilience. During the pandemic a few years ago, the IRS allowed struggling families the ability to tap into their retirement accounts, penalty-free, if they were facing financial challenges. I immediately thought about those without that opportunity.

But being financially resilient is more than having access to money; it includes being conscious of your own financial landscape, being aware of available resources, and being willing to seek out and take advantage of opportunities that will support and increase your financial wellness.

Delaware EARNS represents exactly the kind of opportunity I want to see for the people of our state. It supports the financial resilience of a population that has been woefully underserved for too long. The vast majority of individuals we will help are in the low- to low-moderate-income household bracket. We’re going to offer them a tangible way to close the wealth gap and be financially empowered.  

Ted, if you had a crystal ball, what would you like to see for the program a year or so down the road?

We understand from the experience of other states that it takes time for these programs to build momentum. We’ll just be getting ready to launch in about a year and we recognize that it will take determination and patience to build a lasting success. We’re modest in our initial expectations for account growth. But we also know that, like compound interest, steady gains year by year will eventually lead to sizable numbers of participants and a real difference in the lives of Delawareans.

Treasurer Davis, looking further, what would you like to see five years down the road?

Over time, we expect to reach tens of thousands of Delaware savers. We’ll be working hard in the coming years to grow the number of participating employees and employers in Delaware EARNS, and we’ll be tracking those enrollments as one measure of our success. But we’re also hoping our focus on retirement savings will lead employers to consider other options, such as offering a 401(k). The true measure of success will be significantly reducing the number of Delaware workers without access to a retirement plan at work.

What makes Delaware EARNS different from some other government programs is that it’s an upstream solution. That is, by giving people the opportunity to save for retirement now, we avoid enormous problems in the future. If Delaware workers enter retirement more finically secure, that can save our taxpayers millions of dollars—perhaps even billions—that would otherwise have to be spent on services.

Ultimately, our goal is to ensure as many people as possible can retire with dignity.

“Davis and Griffith,” you are cultivating some new ground. Thank you for sharing your perspectives – we look forward to sharing your updates in editions to come. RSMers, you can connect with Ted Griffith here and follow the Delaware EARNS program here.

Colleen C. Davis was elected State Treasurer in November 2018 and re-elected to a second term in 2022. Since taking office, Treasurer Davis has focused on three main priorities: bolstering retirement security and readiness, creating pathways to economic empowerment, and promoting a culture of financial excellence. Highlights of her first term include maintaining Delaware’s AAA bond rating, increasing return on the state’s investments by more than $58 million, and creating Delaware Expanding Access to Retirement & Necessary Savings (EARNS), an Auto-IRA program for Delaware private-sector workers not otherwise covered by an employer-sponsored retirement plan.

Ted Griffith brings to the role of Delaware EARNS program director extensive experience in financial planning as well as marketing and communications. A Certified Financial Planner (TM) professional, Ted worked for 16 years at the global investment company Vanguard. Most recently, he was a high net worth financial advisor and helped to oversee $100 million in client assets. He was also a marketing and communications manager with responsibility for fund reports and other content distributed to millions of investors. Before his career in financial services, Ted was an award-winning journalist for a variety of outlets, including CBS MarketWatch. He is an active volunteer in his community and currently serves as the treasurer for a statewide non-profit, the Down Syndrome Association of Delaware.

This piece was also featured in the November 2, 2023, edition of Retirement Security Matters. For more fresh thinking on retirement savings innovation, check out the newsletter here.