Determining the “default” investment for savers who do not make a decision about where to direct their contributions is a weighty decision. The downside of putting the money into investments that carry more risk, and a greater potential for loss, is obvious. But parking the contributions in a “safe” investment with lower risk means participants’ accounts may not grow sufficiently to provide significant income security in retirement. Increasingly, target-date funds (TDFs) have become a popular solution.

Grant Boyken shares current best practices related to automatic enrollment and automatic escalation in the retirement savings space — and especially for state-facilitated programs.

States standing up retirement security programs face lots of design decisions. The biggest one - which model to use! Marketplace, MEP or Auto IRA - they’ve all got their appealing features. Focusing on your specific intended outcomes helps.