Governor to Approve State-Run Retirement for Private Workers

Small BusinessAssociated Press

California's governor is preparing to sign a bill to automatically enroll millions of private-sector workers in retirement savings accounts.

Continue Reading Below

The legislation is an attempt to address the growing concern that many workers will be financially unprepared to retire. Gov. Jerry Brown says he'll sign it on Thursday.

More From FOXBusiness.com...

SB1234 creates a state-run retirement program for nearly 7 million workers who don't have an employer-sponsored plan. Employers will be required to enroll their workers and deduct money from each paycheck, though workers can opt out.

Supporters say that since opting out is more work, workers will be less likely to do so, allowing them to set aside a nest egg.

The financial services industry aggressively lobbied Brown for a veto, warning the proposal is built on a shaky financial footing.