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The current state of state-sponsored retirement programs
Public policy Industry trends

The current state of state-sponsored retirement programs

Nicolle Willson, J.D., CFP®, C(k)P®

In recent years, states across the country have enacted retirement savings programs to help individuals save for retirement. As of November 2021, 14 states have enacted or created programs, with dozens of others considering legislation. The rules of these state mandated programs vary greatly from state to state, but they could help bridge the retirement gap for as many as 41 million U.S. workers who currently don’t have access to an employer-sponsored plan.

As a company that was founded to help close the retirement access gap, we’re incredibly excited by these new developments and the renewed interest in retirement savings. We created this resource hub to provide relevant information for business owners and key dates and will continue to update it as state sponsored plans take shape and new states join the movement.

California

  • Program: Employers with 5 or more employees are required to provide access to CalSavers or a private retirement plan.
  • Status: Active
  • Upcoming deadline: June 30, 2022 for businesses with 5+ employees.
  • Penalties: CalSavers announced on January 12, 2022 that it will begin to impose penalties on non-compliant employers with 100 + employees.

Connecticut

  • Program: Employers with 5 or more employees and don’t have an existing qualifying retirement plan, are required to provide access to the Connecticut Secure Choice Savings Plan or a private retirement plan. The program will not be mandatory for businesses with fewer than five employees or those that already offer a work-based retirement savings option.
  • Status: Pending
  • Upcoming deadline: The Retirement Security Authority is still refining the implementation timeline and we expect more updates to come in 2022.

Colorado

  • Program: The Colorado Secure Savings Program requires employers with 5 or more employees who have been in business for 2 or more years, and don’t have an existing qualifying retirement plan, to sign up for the state program or offer an employer-sponsored retirement plan. Colorado will be partnering with New Mexico’s Work and Save Act via a Memorandum of Cooperation to pursue a partnership agreement for their auto-enroll IRA programs, creating the first multi-state auto-enrollment IRA program in the nation.
  • Status: Active
  • Upcoming deadline:  The program is in creation and the pilot program is expected to launch in October 2022. Colorado’s deadline for compliance is 2023. Compliance with the program will not begin until at least one year after the program is formally established, or one year after an employer is scheduled to offer the program based on the number of employees or years in business.

Illinois

  • Program: Employers with 16 to 24 employees, who have been in operation for at least two years, are required to provide access to the Illinois Secure Choice state retirement program or a qualified retirement plan by November 1, 2022. ​​Exempt employers include those with fewer than 5 employees, have been in business for less than two years, or who already offer an employer-sponsored retirement plan.
  • Status: Active
  • Upcoming deadline: November 1, 2022 for businesses with 16 - 24 employees and November 1, 2023 for businesses with 5 to 14 employees. The State will monitor compliance and help employers meet deadlines and requirements. Those who do not comply with the Program may be subject to penalties and fines. Enforcement for non-compliant employers with 25 or more employees will begin in 2022.

Louisiana

  • Program: Introduced Senate Bill 283 which would have established the Louisiana Retirement Savings Plan for employers who do not provide their employees with access to a retirement plan. No further legislative action was taken after it was referred to the Committee on Retirement.
  • Status: Pending
  • Upcoming deadline: None

Maryland

  • Program: Maryland’s new Automatic Retirement Savings Plan, MarylandSaves, is expected to launch its pilot program in June of 2022, and offer open enrollment in September2022 to provide its workers with access to a payroll-deducted savings program if they are not eligible to participate in an existing employer plan. The State will waive the $300 annual report filing fee every year an employer participates in the State program or offers a qualified plan for their employees.
  • Status: Enacted. The program is expected to offer open enrollment  in September of 2022.
  • Upcoming deadline: None

Massachusetts

  • Program: Nonprofit organizations with 20 or fewer employees must offer a retirement benefits plan through a 401(k) multiple employer plan (MEP) through the Massachusetts Defined Contribution CORE Plan or a private provider.
  • Status: Active
  • Upcoming deadline: None

Nebraska

  • Program: In 2013, the Retirement Systems Committee of the Nebraska Legislature launched a study to examine the availability and adequacy of retirement savings for Nebraska’s private-sector employees. No further legislative action has been scheduled.
  • Status: Pending
  • Upcoming deadline: None

New Hampshire

  • Program: The New Hampshire Statutory Commission on Retirement Security launched a study to examine the creation of a state-sponsored retirement plan. House Bill 239 which would establish the commission to study the creation of a state program was voted on in the House on February 11, 2015, and failed to advance. No further legislative action was taken.
  • Status: Pending
  • Upcoming deadline: None

New Jersey

  • Program: Both non- and for-profit businesses with 25 or more employees that have been in business for at least two years must implement the New Jersey Secure Choice Savings Program or provide access to a qualified retirement plan.
  • Status: Pending
  • Upcoming deadline: Early 2022. New Jersey extended their original launch date of March 2021 (state legislation allows for up to a 12 month delay). Employers will have nine months until after the program is enacted to comply with the legislation and assume program responsibilities.

New Mexico

  • Program: On February 26, 2021, Gov. Michelle Lujan Grisham signed the New Mexico Work and Save Act, creating a voluntary Roth IRA savings option for workers without employer-based retirement accounts, plus an online marketplace (the Retirement Savings Plan Marketplace) of private-sector providers for employers. New Mexico and Colorado entered into a formalized partnership agreement for their auto-enroll IRA programs, creating the first auto-enroll IRA multi-state program in the country.
  • Status: Enacted.
  • Upcoming deadline: July 1, 2024

New York

  • Program: On October 21, 2021, Governor Hochul signed into law The New York State Secure Choice Savings Plan program, requiring all private employers who have employed at least 10 New York-based employees during the previous calendar year, and that have been in business for at least 2 years, to enroll their employees in the State program, or offer a qualified retirement plan. The State program follows a Roth IRA structure.
  • Status: Active
  • Upcoming deadline: None. Although the Act was effective immediately, the program is not yet operational. Employers will have nine months until after the program is enacted to comply with the legislation and assume program responsibilities.

North Dakota

  • Program: Introduced House Bill 1200 which would have established the Save Toward a Retirement Today program for employers with no more than 100 employees and who do not offer retirement plans. The House voted on HB 1200 on February 10, 2015 and the bill failed to advance. No further legislative action was taken.
  • Status: Pending
  • Upcoming deadline: None

Ohio

  • Program: Introduced House Bill 645 on May 19, 2020 to establish an auto-enrollment retirement savings program, the Ohio Retirement Savings Program, for private sector employees. The bill describes a defined benefit program, which is different from the rest of the plans introduced in this space.
  • Status: Pending
  • Upcoming deadline: None

Oregon

  • Program: All employers with employees in Oregon must offer a qualified retirement plan to their employees or implement OregonSaves.
  • Status: Active
  • Upcoming deadline: Targeted for late 2022 for 4 or fewer employees

Utah

  • Program: Introduced a resolution to urge Utah’s small business community to work with the state’s Legislature and Treasurer to study and develop a model for a state sponsored retirement savings program. No further legislative action was taken.
  • Status: Pending
  • Upcoming deadline: None

Vermont

  • Program: The Green Mountain Secure Retirement Plan is available as a voluntary MEP to employers with 50 employees or fewer and employers that do not currently offer a retirement plan to their employees. The plan intends to cover self-employed individuals as well.
  • Status: Pending. The Green Mountain Secure Retirement plan was set to launch in the first half of 2021 but there have been no developments.
  • Upcoming deadline: None

Virginia

  • Program: The State of Virginia has passed legislation to create VirginiaSaves. The program is estimated to launch in July of 2023 and will require employers who have been in business for at least 2 years with 25 or more employees to implement the state program or offer a qualified retirement plan.
  • Status: Active
  • Upcoming deadline: None

Washington

  • Program: The Washington State Legislature created the Small Business Retirement Marketplace to provide small businesses and individuals access to a retirement plan. It is a website where employers and employees can shop and compare state-verified and low-cost retirement savings plans.
  • Status: Active
  • Upcoming deadline: None. The program is completely voluntary.

West Virginia

  • Program: The Joint Committee on Government and Finance was tasked with launching a study to determine the need and feasibility of creating a state sponsored retirement program. No further legislative action was taken.
  • Status: Pending
  • Upcoming deadline: None
States leading the way with retirement programs
The future of retirement in the US

The information provided herein is general in nature and is for informational purposes only. It should not be used as a substitute for specific tax, legal and/or financial advice that considers all relevant facts and circumstances.  You are advised to consult a qualified financial adviser or tax professional before relying on the information provided herein. Deadlines and other program details are subject to change by the state without notice and should be checked prior to making any decisions.