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Skip to main * Pricing * Retirement Solutions 401(K) PLAN COST CALCULATOR SECURE Act 2.0 expanded tax credits. See if you qualify and calculate your plan costs. Calculate Your Costs Retirement Plans 401(k) Get a customizable, affordable 401(k) plan 403(b) Retirement plans for tax-exempt businesses Safe Harbor Pass IRS tests with a safe harbor provision Our Solution Payroll Integrations Reduce manual work with payroll integration Investment Advice Explore our strategic approach to investing Customer Reviews from G2 See why we’re named a leader in the 401(k) software category * Payroll Integrations WE INTEGRATE WITH 400+ LEADING PAYROLLS. Changing the SMB 401(k) experience through seamless payroll integrations. Find Your Payroll Top Payroll Integrations Heartland QuickBooks Online BambooHR Paylocity Rippling Fingercheck Paycor Zenefits Namely Gusto UKG See All * Who We Serve Partners See All Accounting Professionals Lower tax liabilities and grow your firm Benefit Brokers Ensure your clients stay ERISA compliant Financial Advisors Help your SMB clients prepare for their future Banks Improve your offerings and stay competitive Industries Startups Retirement plans that scale with your startup Franchises A customer-focused, cost-effective 401(k) plan Nonprofits Full-service 401(k) or 403(b) retirement plans Restaurants 401(k)s for both your full and part-time employees Customer Stories See All How a safe harbor 401(k) helps Curtis&Co reduce risk and empower employees Sexy Pizza aims to transform the restaurant industry with 401(k) benefits How Kevin Cradock Builders helps construct a bright future for their team * Learn Learning Center See All For Employers Learn more about 401(k) plan administration For Employees How to get the most from retirement planning Retirement Legislation Stay updated on the future of retirement policy Latest Content See All What is a highly compensated employee? Reimagining the definition of retirement: Meet Pretirement. SECURE Act 2.0: Changes to retirement planning (2023) Featured Resources The Human Interest Plan Cost Calculator What is a state-sponsored retirement plan? The ultimate guide to starting a small business 401(k) Get StartedLog In * Pricing * Retirement Solutions 401(K) PLAN COST CALCULATOR SECURE Act 2.0 expanded tax credits. See if you qualify and calculate your plan costs. Calculate Your Costs Retirement Plans 401(k) Get a customizable, affordable 401(k) plan 403(b) Retirement plans for tax-exempt businesses Safe Harbor Pass IRS tests with a safe harbor provision Our Solution Payroll Integrations Reduce manual work with payroll integration Investment Advice Explore our strategic approach to investing Customer Reviews from G2 See why we’re named a leader in the 401(k) software category * Payroll Integrations WE INTEGRATE WITH 400+ LEADING PAYROLLS. Changing the SMB 401(k) experience through seamless payroll integrations. Find Your Payroll Top Payroll Integrations Heartland QuickBooks Online BambooHR Paylocity Rippling Fingercheck Paycor Zenefits Namely Gusto UKG See All * Who We Serve Partners See All Accounting Professionals Lower tax liabilities and grow your firm Benefit Brokers Ensure your clients stay ERISA compliant Financial Advisors Help your SMB clients prepare for their future Banks Improve your offerings and stay competitive Industries Startups Retirement plans that scale with your startup Franchises A customer-focused, cost-effective 401(k) plan Nonprofits Full-service 401(k) or 403(b) retirement plans Restaurants 401(k)s for both your full and part-time employees Customer Stories See All How a safe harbor 401(k) helps Curtis&Co reduce risk and empower employees Sexy Pizza aims to transform the restaurant industry with 401(k) benefits How Kevin Cradock Builders helps construct a bright future for their team * Learn Learning Center See All For Employers Learn more about 401(k) plan administration For Employees How to get the most from retirement planning Retirement Legislation Stay updated on the future of retirement policy Latest Content See All What is a highly compensated employee? Reimagining the definition of retirement: Meet Pretirement. SECURE Act 2.0: Changes to retirement planning (2023) Featured Resources The Human Interest Plan Cost Calculator What is a state-sponsored retirement plan? The ultimate guide to starting a small business 401(k) Get StartedLog In Learn Retirement legislation State legislation Articles Table of contents * State retirement plan FAQs * States with active retirement laws * States that have passed legislation * States that have introduced legislation * Choosing the right retirement plan WHAT IS A STATE-SPONSORED RETIREMENT PLAN? LAST REVIEWED Feb 02 2023 8 MIN READ By The Human Interest Team THE HUMAN INTEREST TEAM We believe that everyone deserves access to a secure financial future, which is why we make it easy to provide a 401(k) to your employees. Human Interest offers a low-cost 401(k) with automated administration, built-in investment education, and integration with leading payroll providers. Editorial Policy Table of contents * State retirement plan FAQs * States with active retirement laws * States that have passed legislation * States that have introduced legislation * Choosing the right retirement plan America’s retirement landscape is changing. Pensions have largely disappeared from the private sector, Social Security seems fragile, and many workers are struggling to save for retirement, especially employees at small-to-medium businesses. Many states have passed legislation regarding retirement plans—and have upcoming registration deadlines. It’s more important than ever to figure out what’s required of your business, as well as to find the best retirement plan for you and your employees. Before deciding what kind of coverage you want to offer your employees, however, it's essential to understand how state-sponsored retirement plans work and how they can benefit you and your employees. Unsure what’s going on in your state? Keep reading to find out. Learn more about starting a 401(k) plan for your business: * Use our calculator to see how much a 401(k) would cost with SECURE Act tax credits applied. * Read more about the fees associated with launching and maintaining a 401(k) plan for your business. * Read our guide on setting up a small business 401(k). STATE RETIREMENT PLAN FAQS WHICH STATES HAVE PASSED LAWS? Since 2012, 46 states have either implemented a state-based retirement savings program, studied program options, or considered legislation. Today, there are 16 states and two cities that have either passed laws or have pending legislation that outlines new programs for private sector workers. Of that number, eight states have active laws. STATES WITH ACTIVE RETIREMENT LAWS 1. CALIFORNIA * Type of plan: Individual Retirement Account (Auto-IRA) * Deadlines: Final deadline on June 30, 2022 requires employers with 5+ employees to offer a plan (mandates for businesses with 100+ employees and 50+ employees have already passed). * Fines: Employers may be subject to a $250 fine per employee if found in non-compliance 90+ days after the notice and a $500 fine per employee if found in non-compliance after 180+ days. Learn more about CalSavers 2. COLORADO * Type of plan: Individual Retirement Account (Auto-IRA) * Deadlines: Employers with 50+ employees must register by March 15, 2023; Employers with 15-49 employees must register by May 15, 2023; Employers with 5-14 employees must register by June 30, 2023. * Fines: Employers may be subject to a $100 fine per employee (up to a maximum of $5,000 per calendar year) if found in non-compliance. Learn more about Colorado SecureSavings 3. CONNECTICUT * Type of plan: Individual Retirement Account (Auto-IRA) * Deadlines: MyCTSavings opened for enrollment on April 1, 2022. Employers with 100 or more employees must register by June 30, 2022; employers with 26 to 99 employees must register by October 31, 2022. * Fines: There are penalties, but they are currently undefined. According to the program, "If a business falls out of compliance and fails to register, an investigation could occur and there may be penalties." Learn more about MyCTSavings 4. ILLINOIS * Type of plan: Individual Retirement Account (Auto-IRA) * Deadlines: Employers with 16-24 employees must register by November 1, 2022; employers with 5-15 employees must register by November 1, 2023. * Fines: Employers may be subject to a $250 fine per employee for the first calendar year in which employees aren’t enrolled or don’t opt-out and $500 per employee for the second calendar year in which employees aren’t enrolled or don’t opt-out. Learn more about Illinois Secure Choice 5. MARYLAND * Type of plan: Individual Retirement Account (Auto-IRA) * Deadlines: TBD (program opened to the public on September 15, 2022) * Fines: TBD Learn more about MarylandSaves 6. MASSACHUSETTS * Type of plan: Voluntary Open Multiple Employer Plan (MEP) * Deadlines: N/A * Fines: N/A Learn more about Massachusetts Defined Contribution CORE plan 7. OREGON * Type of plan: Individual Retirement Account (Auto-IRA) * Deadlines: Registration for employers with 4 or fewer employees is in March 2023 (registration deadlines for all other businesses have passed). * Fines: Employers may be subject to a $100 fine per employee (up to a maximum of $5,000 per calendar year) if found in non-compliance. Learn more about OregonSaves 8. WASHINGTON * Type of plan: Voluntary Marketplace * Deadlines: N/A * Fines: N/A Learn more about Washington's retirement marketplace STATES THAT HAVE PASSED LEGISLATION StateImportant datesDelawareProgram implementation TBDHawaiiProgram implementation TBDMaineProgram implementation to begin on April 1, 2023New JerseyProgram was expected to launch in March 2022.New MexicoDeadline pushed to July 1, 2024New YorkProgram implementation TBDVermontProgram implementation TBDVirginiaProgram implementation expected July 1, 2023 STATES THAT HAVE INTRODUCED LEGISLATION Arizona, Arkansas, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah, West Virginia, Wisconsin, Wyoming WHY ARE STATES CREATING STATE-SPONSORED RETIREMENT PROGRAMS? In short, legislation has been introduced to encourage more private-sector businesses to offer a state retirement plan to their employees. Studies have found that people are more likely to save for retirement if their employer offers a 401(k) or some other type of retirement savings program. According to a National Institute on Retirement Security report from 2018, nearly 60% of working Americans lack access to a workplace retirement plan. To address the retirement savings crisis, states have implemented or proposed legislation to establish a state-sponsored retirement savings plan to help employees save. HOW DO STATE-MANDATED RETIREMENT PLANS WORK? While these plans are commonly thought of as 401(k)s, this isn’t necessarily true. The majority of state-sponsored plans are actually Roth IRAs, which have a different set of factors to compare from a competitor offering another 401(k): * 401(k)s can be pre-tax, while Roth IRAs are always post-tax * 401(k)s have a higher annual contribution limit compared to Roth IRAs * In 2023, 401(k) contribution limits are $22,500 ($30,000 for those older than 50); while IRA contribution levels are $6,500 ($7,500 for those older than 50). For more information: IRA vs Roth IRA vs 401(k): What’s the difference? DO STATE-MANDATED RETIREMENT PROGRAMS WORK? Results have been mixed so far. For example, a 2021 study from the National Bureau of Economic Research found that, while OregonSaves has generated savings for more than 67,000 participants through April 2020, the average account balance was only $754. On one hand, it’s encouraging that more employees are saving. However, if this average account balance is any indication, these plans are hardly setting up individuals for their retirement years. The reality is that increasing access to retirement benefits is undeniably a worthwhile effort. However, it’s still too early to determine if state-mandated retirement programs truly work across the board. Retirement savings is a marathon, not a sprint. That’s why the current state-run savings programs may need more time to show their true performance. WHAT DOES THIS MEAN FOR SMALL BUSINESSES? Now is the time to get ahead. For small businesses in the states with retirement legislation, now is the time to understand the program and prepare for it. Many of the start dates are still in the future, but preparing now will make for a smoother implementation and make it easier to find the best plan for your business, and simplify implementation. Understand your options. While using the state-sponsored plan is not mandatory, in many states, businesses are legally required to offer some kind of retirement plan. The good news? There are options. CHOOSING THE RIGHT RETIREMENT PLAN Many employers are prioritizing competitive retirement plans. Not only can starting an employer-sponsored plan come with tax benefits, but it’s also attractive to employees. Retirement benefits are central to employee loyalty, as 40% of employees say they’re a key reason to stay with an employer. Plus, 87% of workers say a 401(k) is a must-have when looking for a new job. However, finding the best retirement savings plan for your employees isn’t easy. As an employer, you want to offer your employees tools that help them save for their future. HOW TO CHOOSE THE RIGHT RETIREMENT PLAN Start by identifying what is most important to you and your employees. It might be… * The total amount that you and employees can save each year, as well as whether those contributions will come with any tax benefits. * The time and manual effort it takes to set up and administer the plan. Some providers offer integration with payroll providers to automate employee contributions. * The cost to you, or your employees, and how those compare to the rest of the industry. * The level of support you and your employees desire, including help with setup and day-to-day administration, compliance, or choosing investments. * Whether you and your staff seek dedicated account management and ongoing support by phone or email. * The specific features of the plan, like whether or not investment education is included, vesting schedules, the type of investment options you’ll be able to access, the option to offer perks like an employer match, and more. Read more about how to choose the best 401(k) provider for your needs. If you’re a small business owner interested in offering a workplace retirement savings plan, it’s important to figure out what works best for you. Human Interest can help you find the latest information about state mandates. We offer affordable, customizable plans that can satisfy the mandate in your state and allow you and your employees to save more money each year. Find out which 401(k) plan works best for your business. START A 401(K) WITH HUMAN INTEREST A Human Interest 401(k) plan can connect directly with your favorite payroll provider and has zero transaction fees. Start a 401(k) Article By The Human Interest Team We believe that everyone deserves access to a secure financial future, which is why we make it easy to provide a 401(k) to your employees. Human Interest offers a low-cost 401(k) with automated administration, built-in investment education, and integration with leading payroll providers. SUBSCRIBE TO OUR RETIREMENT ROADMAP NEWSLETTER Retirement isn’t just a destination. It’s a journey, and we’re here to help you. Our newsletter delivers succinct and timely tips, reviewed by Financial Advisors, to help you navigate the path to financial independence. Email Address * Subscribe By providing your email above or subscribing to our newsletter, you agree to our Privacy Policy. You also elect to receive communications from Human Interest. LET'S TALK. Contact Support 855 622 7824 Monday - Friday 6am to 5pm PT / 9am to 8pm ET Contact support online Talk to Sales 877 475 0179 WHY US? * How It Works * Pricing * Our Partners * Payroll Integrations * Investment Advice PRODUCTS * 401(k) Plans * 403(b) Plans * Safe Harbor * Get Started LEARN * Learning Center * For Employers * For Employees * Legislation * FAQ COMPANY * About * Careers * Pressroom * Security * Legal * HIA © 2023 Human Interest, Inc. Disclosures 655 Montgomery Street, Suite 1800 San Francisco, California 94111 Human Interest Inc. is an affordable, full-service 401(k) and 403(b) provider that seeks to make it easy for small and medium-sized businesses to assist their employees with investing for retirement. For more information, please visit humaninterest.com. Investment Advisory services are provided through Human Interest Advisors LLC, a Registered Investment Adviser and subsidiary of Human Interest Inc. For more information on our investment advisory services, please visit https://www.humaninterest.com/hia/. This content has been prepared for informational purposes only, and should not be construed as tax, legal, or individualized investment advice. Human Interest Advisors LLC does not provide tax or legal advice. Consult an appropriate professional regarding your situation. The views expressed are subject to change. 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