Save for retirement or go to your room

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Maryland residents who fail to save for their own retirements are like drivers who speed or children who won’t do what you tell them to do, according to former Lt. Gov. Kathleen Kennedy Townsend.

Kennedy Townsend, who leads a task force studying the problem of retirement savings for private sector employees, made the comparison during a hearing in Annapolis.

The group is looking at the possibility of recommending the creation of a mandated retirement program where nongovernment employers would be required to offer a retirement plan or enroll employees into a state managed plan. Employees would be automatically enrolled and as much as 6 percent of their pay deducted for retirement (under one proposal) in a defined benefit plan unless the employee opted out.

But opponents of such proposals say more public education about the importance of retirement savings as well as the availability of existing commercial plans is needed.

But other retirement experts who support mandatory savings programs say education is not enough and most people will not save for retirement even though they know they should. The lack of retirement savings results in a drain on government services.

“Education is great…but it is not enough,” said Kennedy Townsend. “It won’t get us to where we want to go.

“I love education but why do drivers stop speeding? It’s not because they were told ‘This is bad for you’ but because things happen to make you quit speeding. I’m a great believer in education but I know as a mother of four children, I can tell kids what to do or I can tell them they have to go to their room if you don’t do it.”

The task force is on pace to be about one month late in delivering a report that was part of an executive order issued earlier this year when Gov. Martin J. O’Malley established the 14-member task force. It is scheduled to expire on Feb. 15 unless the governor issues another order allowing it to continue its work until the end of next year.

Sen. James C. Rosapepe, D-Prince George’s County, said the group would need the extra year to finalize recommendations for the creation of a mandated retirement savings system.

Gov.-elect Larry Hogan, a Republican, said Tuesday that he would not issue an order allowing the group to continue.