RETIREMENT PLANS

Are you ready for CalSavers?

Failure to register with CalSavers could be costly

All California businesses with five or more employees must now offer a compliant retirement plan or register with CalSavers.

Those businesses not in compliance could face fines of up to $750 per employee.

What is CalSavers?

CalSavers is California’s retirement savings program for employers that do not offer a retirement plan. The state mandates that eligible businesses must either enroll their employees in these state-run, automatic enrollment, payroll deduction IRAs or offer their workers a tax-favored retirement plan.

Retirement plan compliance

Employers have a wide variety of retirement plan alternatives to CalSavers.

Some of the most popular include:

SEP

Simplified Employee Pension plans

SIMPLE IRA

Savings Incentive Match Plan for Employees (of small employers)

401(k)

Retirement plan

Know your options

In addition to the benefits of a more traditional 401(k), employers may also be interested in SEP and SIMPLE IRA plans that can offer similar tax benefits with easy setup and administration and low costs.

Eligible Employees

Contribution Limits

CalSavers

All employess at least age 18

$6,000 (lower for individuals at higher income levels)4

SEP

Most full- and part-time employees1

Lesser of 25% of pay or $61,0005

SIMPLE IRA

Most full- and part-time employees2

$28,000, including employer match/discretionary contributions5,6

401(k)

Most full- and part-time employees3

Lesser of 100% of compensation or $61,000, including employer contributions7

CalSavers

SEP

SIMPLE IRA

401(k)

Eligible employees

All employees at least age 18

Most full- and part-time employees1

Most full- and part-time employees2

Most full- and part-time employees3

Contribution limits

$6,000 (lower for individuals at higher income levels)4

Lesser of 25% of pay or $61,0005

$28,000, including employer match/discretionary contributions5,6

Lesser of 100% of compensation or $61,000, including employer contributions7

1 Anyone employed in at least three of the last five years, has reached age 21, and has earned at least $650 from your company
2 Any employee who expects to earn $5,000 in the current year and has earned at least that much in any of the two prior years
3 Generally, any employee at least age 21 and with at least one year of service although statutory exclusions can apply
4 Limit increases to $7,000 at age 50
5 Compensation on which the employer calculates maximum contributions is limited to $305,000 for 2022, except for SIMPLE IRA matching contributions
6 Participant contribution limit is $14,000, rising to $17,000 at age 50
7 Participant contribution limit is $20,500, rising to $27,000 at age 50

You don't have to settle for CalSavers

Employers shouldn't miss this chance to opt in to a plan that's appropriate for their workforce and their business.

(800) 421-9900

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