CBC Retirement
State Mandates
States across the USA have started implementing requirements for business owners to offer their employee's a retirement plan benefit. Most notably, California, Oregon, Colorado and Illinois have already passed deadlines for businesses to offer a plan. If the tax credits are the carrot, these mandates are the stick. Read below to learn more about the different mandates for each state.
California State Mandate [Calsavers]
What is it?
Cal Savers Is a Mandate Requiring Retirement Plans for Businesses with 5+ Employees
Why is it important?
The mandate went into effect for businesses 100+, 50+, and 5+ employees in 2020, 2021, and 2022, respectively
Calsavers Does:
-Require every employee to be automatically enrolled at 5%
-Increase by 1% annually to 8%
-Require employees to login online to opt out
-Limit “opt-out” to 2 years
-Restrict access to fund option
-Charge 0.82% of assets
Calsavers Does NOT:
-Integrate with payroll, requires manual entries
-Offer a tax credit to business owners
-Track employee eligibility
-Offer options for employee eligibility periods
-Educate employees on fund management
-Offer unlimited fund options​​
Penalty for Non-Compliance
-$250 per Employee after 90 days
-Additional $500 per Employee after 180 days
Colorado State Mandate [SecureSavings]
What is it?
Colorado Securesavings Is a Mandate Requiring Retirement Plans for Businesses with 5+ Employees that have been in operation for more than 2 years.
Why is it important?
The mandate went into effect for businesses 50+, 15+, and 5+ in March, May, and June of 2023 respectively.
Colorado SecureSavings Does:
-Require every employee to be automatically enrolled at 5% Roth Contribution Rate
-Invests the funds in "Capital Preservation" for first 30 days in case employee decides to opt-out within the timeframe to recieve their funds back with minimal fluctuation
-After 30 days the funds are automatically defaulted to a target date fund based on the employee DOB
-Require employees to login online to opt out
-Charge 0.32% of assets and $22 annually
Colorado SecureSavings Does NOT:
-Integrate with payroll, requires manual entries
-Offer a tax credit to business owners
-Track employee eligibility
-Offer options for employee eligibility periods
-Offer unlimited fund options
Penalty for non-Compliance:
​-$100 per employee per year up to $5,000​
​
Illinois State Mandate
[Securechoice]
What is it?
Illinois Securechoice Is a Mandate Requiring Retirement Plans for Businesses with 5+ Employees that have been in operation for more than 2 years and do not currently offer a retirement plan.
Why is it important?
The mandate went into effect for businesses 500+, 100+, 25+, 15+, and 5+ in November 2018, July 2019, November 2019 and November of 2022 and 2023 respectively.
Illinois SecureChoice Does:
-Require every employee to be automatically enrolled at 5% Roth Contribution Rate after a 30 day waiting period
-Require employees to login online to opt out
-Invests Savings into Target Date Funds based on age aligned with an expected retirement age of 65
-Allows for traditional (pre-tax) contributions as well as Roth
-0.32% - 0.45% Asse-Based fee on Investments
Illinois SecureChoice Does NOT:
-Integrate with payroll, requires manual entries
-Offer a tax credit to business owners
-Track employee eligibility
-Offer options for employee eligibility periods
-Offer unlimited fund options
Penalty for non-Compliance:
​-$250 per employee for first calendar year of non-compliance​
-$500 per employee for each non-compliant year thereafter
Oregon State Mandate
[OregonSaves]
What is it?
OregonSaves Is a Mandate Requiring Retirement Plans for Businesses with 5+ Employees that have been in operation for more than 2 years.
Why is it important?
The mandate went into effect for businesses 50+, 15+, and 5+ in March, May, and June of 2023 respectively.
OregonSaves Does:
-Require every employee to be automatically enrolled at 5% Roth Contribution Rate and increases that contribution rate by 1% each year until the maximum of a 10% contribution rate is reached.
-Invests the funds in "Capital Preservation" for first 30 days in case employee decides to opt-out within the timeframe to recieve their funds back with minimal fluctuation
-After 30 days the funds are automatically defaulted to a target date fund based on the employee DOB with an expected retirement age of 65
-Require employees to login online to opt out
-Annual fee of 0.50% of assets and $16 annually, billed at $4 quarterly
OregonSaves Does NOT:
-Integrate with payroll, requires manual entries
-Offer a tax credit to business owners
-Track employee eligibility
-Offer options for employee eligibility periods
-Offer unlimited fund options
Penalty for non-Compliance:
​-$100 per employee per year up to $5,000​