Illinois Secure Choice vs. a Guideline 401(k)

Meet Illinois’s retirement mandate with a simple, powerful Guideline 401(k).

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50K+

businesses1

1M+

savers2

88%

customer satisfaction score3

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Fintech 504

The mandate in a nutshell

The Illinois Secure Choice program was established in 2018. It requires Illinois employers with 5+ employees that have been in business for 2+ years to offer the state-sponsored plan or a qualified alternative like a Guideline 401(k).5 Compare your options

  • 5+ employees

    Initial deadlines have passed, sign up immediately to avoid penalties

Meet the mandate and more with a Guideline 401(k)

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    Simple setup

    Get started in 20 minutes. We’ll help you choose a plan that meets the mandate and your business’s goals.

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    Automated busywork

    Integrations with payroll providers means no need to maintain deductions or manually re-enter payroll data.

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    Live support

    You and your team get access to live support, guided employee onboarding, a mobile app, and more.

Compare Illinois Secure Choice with Guideline Starter

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Illinois Secure Choice

  • Retirement plan type

    Starter 401(k)

    Roth IRA

  • Maximum employee contributions for 20246

    $6,000

    $7,000

  • Employee asset-based fee

    0.15%

    ($15 for every $10,000)7

    0.30%

    ($30 for every $10,000)8

  • Additional active employee fees

    None9

    $16/year account fee

    (charged quarterly at $4 each quarter)

  • Monthly employer fee

    $39 / month + $4 per participant

    None

  • Investment options

    40

    15

    (Including Indexed Funds)

  • Professionally managed portfolios

    6

    0

  • Employer match

    No

    No

  • Profit sharing

    No

    No

Keep your business in compliance. Set up a Guideline 401(k) in just 20 minutes.

Learn more

Looking for a more robust plan? Look no further.

Starter 401(k) plans do have limitations like lower contribution limits and no employer contributions. If you’d like to set up a plan with more options and flexibility, you may want to consider Core or Enterprise.10

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Illinois retirement mandate FAQs

What is the mandate?

The Illinois Secure Choice Program was created to encourage more people to save for retirement. It requires Illinois employers with 5 or more employees to provide access to a retirement plan. The plan can either be a private plan like a 401(k) or the state-sponsored plan.

When does the mandate take effect?

For companies with 5 or more employees, the program is fully active.

Which employers are impacted by the retirement mandate?

You are eligible to participate in the Illinois Secure Choice Program if:

  • Your business is registered to conduct business in the state of Illinois
  • You are required to facilitate Illinois Secure Choice if you reported W-2 wages for 5 or more employees during all four quarters of the previous calendar year to the Illinois Department of Revenue (IDOR).
  • You have been in business for two or more years; and
  • You don’t currently offer a qualified retirement savings program to your employees

Are there penalties for not offering a retirement benefit?

Yes. Employers will be subject to a penalty equal to:

  • $250 per employee for the first calendar year the employer is noncompliant
  • $500 per employee for each subsequent calendar year the employer is noncompliant.12

Does Guideline satisfy the retirement mandate?

Yes. All of Guideline's 401(k) plans are designed to satisfy state program requirements and are priced to be affordable for businesses of all sizes.

Can I move from Guideline Starter to a standard 401(k)?

While it is possible for a plan to convert from a Starter 401(k) to a standard 401(k) plan at Guideline, the transition cannot take place until the beginning of the next calendar year. Learn more here.

  • 1

    As of May 2024

  • 2

    As of August 2024

  • 3

    Guideline’s average customer satisfaction score (CSAT) based on feedback received from 1/1/2023 to 12/31/2023

  • 4

    Forbes Fintech 50, 2022

  • 5

    Guideline has prepared this summary from third-party sources as of April 30, 2024. The information herein is considered to be reliable at the time of writing, may not necessarily be all-inclusive, is not guaranteed as to accuracy and is subject to change at any time without notice. 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. Investing involves risk and investments may lose value. You are advised to consult a qualified financial adviser or tax professional before relying on the information provided herein. Deadlines, fees, and other program details are subject to change by the state without notice and should be checked prior to making any decisions. If you already offer a qualified employer-sponsored plan, exemptions may be required. Please consult with your states specific exemption information: https://employer.ilsecurechoice.com/illinoisertpl/enroll/createEmp/viewCollectEmpPreRegDetails.cs or go to https://www.ilsecurechoice.com/ for more details.

  • 6

    Subject to IRS cost-of-living adjustments. In 2024, individuals can contribute up to $7,000 between their traditional and Roth accounts. If you’re 50 or older, you can contribute an additional $1,000 ($8,000 in total). Starter 401(k) employee can contribute up to $6,000, If you’re 50 or older, you can contribute an additional $1,000.

  • 7

    Information shown here assumes a static balance of $10,000 per month, an assumed annual account fee of between 0.15% on assets under management (calculated and deducted on a monthly basis at 1/12 of the annual stated rate based on the month-end account balance) and does not account for common factors that affect the value of your account balance over time such as gains, losses, distributions, additional contributions, etc. It’s not intended to be taken as investment advice or as an assurance or guarantee of future performance. The fee presented does not include other fees that an IRA owner may incur, including, but not limited to, from mutual fund expense ratios. Alternative account fee pricing is available for the Core and Enterprise plan tiers, ranging from 0.15% to 0.35%. Contact Sales at hello@guideline.com to learn more about exclusive pricing options available in Enterprise tier. See our Form ADV 2A Brochure for more information regarding fees.

  • 8

    Information shown here assumes a static balance of $10,000 per month, which includes the Program Administrative Fee 0.25% plus the State Fee 0.05% on assets under management. Per the Illinois Secure Choice Program. As a Secure Choice Account owner, you indirectly bear a pro rata share of the annual costs and expenses associated with each Investment Option in which you are invested. The Annualized Asset-Based Fees consist of the Underlying Investment Fees, the State Fee, and the Program Administration Fee. The Program Administration Fee, which is in the amount of 0.25% to be paid to the Program Administrator plus 0.05% to be paid to the state of the Investment Options daily net assets. For each Investment Option, the Underlying Investment Fund Fee is derived from the expense ratio reported in each Underlying Investment Fund’s most recent prospectus. Each Investment Option indirectly bears the expenses of the Underlying Investment Funds; so, when fees are deducted from an Underlying Investment Fund’s assets, the value of the Underlying Investment Fund’s shares is reduced. Actual Underlying Investment Fund expenses may vary and are subject to change.

  • 9

    The fee presented does not include other fees that a 401(k) participant may incur, including, but not limited to, from mutual fund expense ratios and a monthly maintenance fee to participants who end employment.

  • 10

    Alternatively priced plan tiers are also available. Go to https://www.guideline.com/pricing for further information. You should consult a tax professional and/or Financial Advisor to determine the best tax advantaged retirement plan for your situation.

  • 11

    This content is for informational purposes only and is not intended to be taken as tax advice. Please consult a tax professional to determine what types of tax credits or deductions your company is eligible to claim.

  • 12

    Illinois Secure Choice Savings Program Act

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