Opportunity to shine

Giving everyone an opportunity to save for retirement has long been Transamerica's mission. For over 85 years we have championed workplace retirement plans. 

More than two decades in the pooled plans space demonstrates our deep commitment to supporting employers of all sizes in bringing quality plans to their employees. 

Large or small, employers need to make informed decisions and select a plan that will work best for them. With our knowledge, experience, and dedication to retirement for all, Transamerica is here to help. 

Why states are getting involved

To expand retirement plan access to as many people as possible, a growing number of states are mandating retirement plans. But a state plan may not be the best choice, and employers may be surprised by the ease and benefits of an employer-sponsored plan and the efficiencies available when they opt for a pooled plan arrangement.

of workers at private-sector employers with <100 employees don't have access to an employer-sponsored retirement plan.

of employers with <100 employees offer a retirement plan

of non-retired adults have NO retirement savings

of workers say 401(k) or similar retirement plans are an important benefit.

Workplace vs. state-facilitated comparison

  • State-facilitated IRA
  • Workplace 401(k)

IRS contribution limit (2024)

IRS contribution limit age 50+ (2024)

Matching contribution option available

Vesting option available

(Employer contributions only)

Financial advisor support available

Employer administrative tasks

Automatic features

Investment options

$7,000

$8,000

No

N/A

No

Yes

Per state plan design

Per state plan design

$23,000

$30,500

Yes

Yes

Yes

Yes

Optional

Yes

Advantages of employer-sponsored plans

With flexible design features, higher contribution limits, and a wider range of investment options, employer-sponsored retirement plans provide advantages for employers and employees.

Small plan tax credits

SECURE and SECURE 2.0 give small employers retirement plan tax credits.

  • 50% or 100% of start-up/administration costs up to $5,000 for first three years
  • Up to $1,000 per participant credit for employer contributions for first five years
  • $500 credit for adding automatic enrollment

Design flexibility

Plan sponsors may include features not available in state-facilitated programs.

  • A vesting schedule for employer contributions can motivate employees to stay longer
  • Financial well-being education is typically offered by qualified plan recordkeepers to encourage employees to take charge of their financial health. Employers providing the state plan would need to find or create financial education on their own.
  • Employer contributions may be deducted from the organization’s current taxes

Attract and retain talent

  • Contributions may be restricted for higher wage earners in state-facilitated IRA plans due to IRS limits
  • A well-designed employer-provided plan may be an incentive to join or remain with the employer
  • Ability to add a vesting schedule for employer contributions can encourage retention

Easier administration for multi-state employers

  • Employers with locations in multiple states may be required to participate in multiple state programs
  • This adds to administrative complexities
  • An employer-sponsored plan offers a single solution covering all employees

Allow employees to save more

  • Employees can save significantly more in an employer-provided plan compared to most state plans
  • Employer plans may include pre-tax and after-tax employee contributions, giving employees flexibility
  • Employer plans may include profit-sharing or matching contributions
  • Financial well-being education is generally part of the services from retirement plan providers. Employers using the state option would need to develop or locate financial education on their own.

Employer-sponsored plans are governed by the Employee Retirement Income Security Act of 1974 (ERISA)

  • ERISA provides significant protections for employee retirement savings 
  • State-facilitated IRA plans are not covered by ERISA so may not have the same level of protection
  • Pooled employer solutions provide fiduciary support that helps protect the employer and employees

Facilitated plans at a glance: State-by-state details

States enacted and currently active

California

CALSAVERS   calsavers.com

Timing

  • Enacted 2016

  • Registration deadline passed for all groups subject to the mandate

Design

  • Employers that do not provide a qualified plan

  • Roth IRA (default) and traditional IRA (optional)

  • Auto enrollment at 5%

  • Auto escalation 1% per year to 8% max

  • Employees may opt out

Investments

  • Contributions held in capital preservation fund for the first 30 days

  • Default investment is target date funds

  • Bond fund, global equity fund, money market fund, sustainability fund also available

  • No employer fees

  • Annualized asset-based fees currently range between 0.825% and 0.95%

Colorado

Colorado Secure Savings Program  coloradosecuresavings.com

Timing 

  • Enacted 2020

  • Registration date passed for all mandated groups

Design

  • Employers in business for two years that have not offered a qualified plan in the last two years

  • Other employers may participate voluntarily

  • Individuals who qualify for an IRA may participate voluntarily

  • Roth IRA (default) and traditional IRA (optional)

  • Auto enrollment at 5%

  • Auto escalation 1% per year to 8% max (may increase to 10% later)

  • Employees may opt out

  • Employer contribution not permitted

Investments

  • Contributions held in capital preservation fund for the first 30 days, then moved to default investment option

  • Default investment is target date funds

  • Bond index fund and international equity funds also available

  • No employer fees

  • Annual asset-based fee of 0.32% plus $22 annual account fee (charged quarterly at $5.50) for administrative and investment expenses. 

Connecticut

MyCTSavings myctsavings.com

Timing

  • Enacted 2016

  • Deadline passed for all mandated groups

Design

  • Employers that do not provide a qualified plan

  • Employers with fewer than 5 employees may opt in voluntarily

  • Roth IRA

  • Auto enrollment at 3%

  • No auto escalation currently

  • Employees may opt out

  • Employer contribution not permitted

Investments

  • Contributions held in money market fund for the first 60 days if no other option selected, then moved to target date fund (which is the default investment)

  • Other strategic investment portfolios available, including cash preservation, income, income and growth, balanced, conservative growth, moderate growth, growth portfolios

  • When participants reach normal retirement age, 50% of their account must be invested in a lifetime income option (not yet identified)

  • No employer fees

  • Employees pay account fee of $6.50 per quarter plus 0.22% program administration fee and fees for statements, checks, rollovers, etc.

 

Illinois

Illinois Secure Choice ilsecurechoice.com

Timing

  • Enacted 2015

  • Registration date passed for all mandated groups

Design

  • Employers that do not provide a qualified plan

  • New businesses may defer joining for two years

  • Self-employed, contract, seasonal workers may enroll

  • Roth IRA (default) and traditional IRA (optional)

  • Auto enrollment at 5%

  • Auto escalation 1% per year, 10% max

  • Employees may opt out

  • Employer contribution not permitted

Investments

  • Contributions held in money market fund for the first 90 days if no other option selected, then moved to target date fund (which is the default investment)

  • Other investment options are capital preservation, conservative, and growth funds

  • No employer fees

  • Employee fees capped at 0.75% of total trust balance. $5 annual fee for paper statements, waived for electronic delivery of statements.

 

Maine

Maine Retirement Investment Trust (MERIT) https://meritsaves.org

Timing

  • Enacted 2021

Currently conducting a pilot, expected to launch in early 2024

Design

  • Employers with five or more employees that have not offered a tax-favored retirement plan to some or all of its covered employees in the current calendar year or two preceding calendar years
  • Other employers may participate voluntarily
  • Partnering with Colorado to offer joint program
  • New employers that have not been in business during the current and preceeding calendar year are exempt
  • Individuals who are self-employed or independent contractors may participate voluntarily
  • Roth IRA; account holders may choose a traditional IRA by notifying the program administrator
  • Auto enrollment at 5%
  • Auto escalation may be added at 1% per year to 10% max, by participant election or mandatory
  • Employees may opt out

Employer contribution not permitted

Investments

  • Contributions will be held in a money market account for the first 30 days then moved to a target-date fund, unless participant directs otherwise

Fees: TBD

Maryland

Maryland$aves marylandsaves.com

Timing

  • Enacted 2016

  • Registration deadline passed for all mandated groups

Design

  • Employers paying employees through a payroll system or service that do not currently provide a qualified plan or have not in the prior two years

  • New businesses may defer joining for two years

  • Others may enroll voluntarily: non-covered employees, employees of non-covered employers, gig workers, 1099 employees, self-employed workers

  • Roth IRA. Traditional IRA being considered as an option.

  • Auto enrollment at 5%

  • Auto escalation 1% per year, 10% max

  • Employees may opt out

  • Employer contribution not permitted

Investments

  • Initial contributions up to $1,000 placed in an emergency savings fund invested in capital preservation fund.

  • Contributions after $1,000 default into target date fund if no other investment is elected

  • Investment options are target date, capital preservation, income, and growth funds

  • No employer fees

  • $30 plus 0.18%-0.85% of assets, depending on investments selected. First year is subsidized so will be less.

 

Massachusetts

Massachusetts Defined Contribution CORE Plan  CORE Plan for Nonprofits | Mass.gov

Timing

  • Enacted 2012

  • October 2017:  Program launched

Design

  • Nonprofit employers with up to 20 employees

  • Employer and employee participation voluntary

  • Multiple employer 401(k) plan (MEP)

  • Auto enrollment at 6%

  • Auto escalation 1% or 2% per year (employer decides), 15% max

  • Employees may opt out

  • Employer may contribute safe harbor match of 100% of first 3% of employee contribution AND 50% of the next 2%, OR safe harbor non-elective contribution of at least 3% of employee contribution

Investments

  • Default investment in target date fund

  • Other investments are growth, income, inflation, and capital preservation funds

  • Professionally managed account available for a fee

  • $65 annual fee deducted from participant account, plus fees for administrative features elected by participant

  • Employer pays one-time set up fee of $2,500, annual administrative fee of $200, and compliance fee of $150 or $750, depending on plan design

 

Oregon

OregonSaves oregonsaves.com

Timing

  • Enacted 2015

  • Registration deadline passed for all mandated groups

Design

  • Employers that do not provide a qualified plan

  • Employers with no employees and employees of non-participating employers may join voluntarily

  • Roth IRA (default) or traditional IRA (alternative election)

  • Auto enrollment at 5%

  • Auto escalation 1% per year, 10% max, for those who have contributed at least six months

  • Employees may opt out

  • Employer contribution not permitted

Investments

  • Contributions held in capital preservation fund for the first 90 days if no other option selected, then moved to target date fund (which is the default investment)

  • Investment options are target date, capital preservation, money market, and growth funds

  • No employer fees

  • Asset-based fee of 0.25% plus $1.50 per month account fee (assessed quarterly)

 

Virginia

RetirePath Virginia

Timing 

  • HB 2174 passed 2021

  • Launched July 1, 2023

  • February 15, 2024 registration deadline for employers eligible in 2023 

Design

  • Employers in business for at least two years, with 25+ employees who worked 30+ hours a week in the prior calendar year, and that have not offered a qualified retirement plan

  • Other employers may participate voluntarily

  • Eligible employees of employers not in the program may participate voluntarily

  • Self-employed individuals may participate if they have taxable Virginia income

  • Roth IRA; traditional IRA may be added later as an alternative

  • Auto enrollment at 5%

  • Auto escalation at 1% per year to 10% max

  • Employees may opt out

  • Employer contribution not permitted

Investments

  • Default investment TBD

  • Other funds available: TBD

Fees: TBD 

Washington

Washington Small Business Retirement Marketplace retirement-marketplace.com

Timing

  • Enacted 2015

  • March 2018: Program launched

Design

  • Employers with fewer than 100 employees

  • Self-employed workers and sole proprietors may join

  • Employer and employee participation voluntary

  • SIMPLE, Roth and traditional IRAs, and ERISA plans

  • May include life insurance plans designed for retirement purposes

  • Auto enrollment available if plan covered by ERISA

  • Auto escalation available if plan covered by ERISA

Investments

  • Varies by plan selected

  • No employer fees

  • Employee fees limited to 1% of account balance annually PLUS small service provider fees for new or low balance accounts

 

States enacted, not yet active

Delaware

DelawareEARNS   de.gov/earns 

Timing

  • Enacted 2022

Design

  • Employers in business for at least six months in preceding calendar year with 5+ employees and do not offer a qualified retirement plan

  • Other employers may participate voluntarily

  • Eligible employees of employers not in the program may participate voluntarily

  • Self-employed individuals may participate if they have taxable Virginia income

  • Roth IRA; traditional IRA authorized to be added later

  • Auto enrollment to be set between 3% and 6% at Board’s discretion

  • Auto escalation may be added at 1% or 2% per year to 15% max, at Board’s discretion

  • Employees may opt out

  • Employer contribution not permitted

Investments

  • Default investment TBD

  • Other funds available: TBD

  • Fees: TBD 

 

Hawaii

Hawaii Retirement Savings Program 

Timing

  • Enacted 2022

  • Implementation date: TBD

Design

  • Employers with 1+ employees 

  • Roth IRA for employees who opt in

  • Traditional IRA may be added later

  • Default contribution rate 5% for employees electing to participate

  • No opt out provision since employees much choose to participate

  • Employer contribution not permitted

  • The Board may authorize matching contributions up to $500 to accounts of the first 50,000 participants

Investments

  • Default investment option: TBD

  • Other funds: TBD

  • Fees: TBD, but may not exceed 0.75% of assets after the program’s first three years

 

Minnesota

Minnesota Secure Choice Retirement Program

Timing 

  • Enacted 2023

  • Must begin on or after January 1, 2025, in phases, with final phase opened no later than two years after opening of first phase

Design

  • Employers with 5+ covered employees that do not provide a qualified plan

  • Roth IRA (default) or traditional IRA (if employee elects)

  • Auto enrollment

  • Employees may opt out

  • Employer contribution not permitted

Investments

  • Investment options TBD, to include a diversified default investment

  • Other options TBD, to include target date funds, balanced fund, capital preservation fund, or any such combination

  • The Board may assess fees

Missouri

Missouri Show-Me MyRetirement Savings Plan

Timing

  • Enacted 2023

  • Contributions expected to begin on or before September 1, 2025

Design

  • Employer participation voluntary

  • Employers with 50 or fewer employees in last five years that do not currently offer a plan

  • Multiple employer 401(k) plan (MEP)

  • Auto enrollment permitted once employer joins MEP

  • Employees may opt out

  • Employers may contribute

  • Self-employed individuals are eligible

Investments

  • Investments TBD

  • Fees may be charged and Board will seek to minimize them

Nevada

Timing 

  • Enacted 2023

  • Contributions accepted beginning July 1, 2025

Design

  • Employers with 5+ employees, in business at least 36 months, that do not provide a qualified plan during current year or 3 previous calendar years

  • IRA (type TBD)

  • Auto enrollment

  • Employees may opt out

  • Employer contribution not permitted

Investments

  • Investment options TBD

  • Fees TBD

New Jersey

New Jersey Secure Choice Retirement Savings Program  nj.gov/treasury/securechoiceprogram/

Timing 

  • Enacted 2019

  • Not yet active

Design

  • Employers with 25+ employees, in business more than two years, that do not provide a qualified plan

  • Roth IRA and traditional IRA authorized

  • Auto enrollment at 3%

  • Employees may opt out

  • Employer contribution not permitted

Investments

  • The Board may direct first $1,000 in contributions invested in capital preservation fund

  • Other investment options are lifecycle fund or options deemed appropriate by the Board

  • Administrative fees capped at 0.75% of total fund for first three years after establishment, then capped at 0.6%.

New Mexico

New Mexico Work and Save Program

Timing

  • Enacted 2020

  • On or before July 1, 2024:  Anticipated launch

Design

  • Voluntary participation for all private sector and nonprofit employers with primary business located in New Mexico

  • Default is voluntary Roth IRA; other IRA options permitted

  • Retirement plan marketplace options include SIMPLE IRA, payroll deduction IRA, MEP as allowed under federal law, 401(a) or 403(b) plans

  • Auto enrollment in a voluntary IRA if allowed by federal law

  • Auto enrollment is permitted for employers participating in the marketplace option

  • Auto escalation TBD for voluntary IRAs; not specified for marketplace option

  • Employees may opt out

  • Employer contribution not permitted in voluntary IRA

  • Employer contribution permitted for employers using the marketplace option with an ERISA plan

Investments

  • Default investment for voluntary IRA is TDF

  • Other funds and structure: TBD

  • Voluntary IRA fees must be below 1%

  • Marketplace fees must cover actual cost of plan, TBD 

New York

New York State Secure Choice Savings Program   securechoice.ny.gov 

Timing

  • Voluntary payroll deduction IRA enacted 2018

  • Amended to current form 2021

  • Launch date: TBD

Design

  • Employers in business for at least two years, that employed at least 10 employees in the State of New York at all times during the previous calendar year, and has not offered a qualified retirement plan in the prior two years

  • Roth IRA

  • Auto enrollment at 3%

  • No auto escalation

  • Employees may opt out

  • Employer contribution not permitted

Investments

  • Default investment option: TBD

  • Other funds: TBD

  • Fees: TBD, but required to be kept as low as possible and to allocate administrative fees to accounts on a pro rata basis 

Vermont

Vermont Green Mountain Secure Retirement Plan   vermonttreasurer.gov/content/green-mountain-secure-retirement-plan

Timing

  • Program revised, newly enacted 2023

  • Phased enrollment begins July 1, 2025 for covered employers with 25+ covered employees

  • Enrollment for employers with 15-24 employees begins January 1, 2026

  • Enrollment for employers with 5-14 employees begins July 1, 2026

Design

  • Employer participation mandatory

  • Employers that have not offered a retirement plan in previous two years

  • Self-employed individuals and contractors may be eligible to participate

  • Roth IRA

  • Auto enrollment at 5%

  • Auto increases from 1% to 8% of active participant’s contribution rate per year

  • Other plan features TBD

  • Employees may opt out

  • Employer contributions not permitted

Investments

  • Default and other investments: TBD

  • Fees: TBD but limited to $30 per participant per year

Enacted, unlikely to become active

New York City

Savings Access New York Retirement Program — Legislation specified that the auto-IRA program would not be implemented if New York State establishes a program covering a substantial portion of uncovered employees. It is assumed the city will not implement its own program.

Seattle, WA

Seattle Retirement Savings Plan — An auto-IRA program which is not anticipated to be implemented because of a state legal issue identified after the legislation passed. The Board decided in December 2018 that it will not implement the program, pending possible legal action by the Washington State Legislature on proposals to establish a statewide auto-IRA program.

Talk to a Transamerica representative today

Selecting the right plan for your organization can help you stand out as an employer. Your Transamerica representative is ready to discuss alternatives to help you make a choice that works for you and your employees. Call 888-401-5826.

Please note: Information regarding state-facilitated plans is gathered from Georgetown University Center for Retirement Initiatives, including "State-Facilitated Retirement Savings Programs: A Snapshot of Plan Design Features, Georgetown University Center for Retirement Initiatives, June 30, 2023 update"

Neither Transamerica nor its agents or representatives may provide tax, investment or legal advice. Anyone to whom this material is promoted, marketed, or recommended should consult with and rely on their own independent tax and legal advisors and financial professional regarding their particular situation and the concepts presented herein.