Your guide to the Minnesota Secure Choice Retirement Program

Minnesota has joined the ranks of other states with a state-sponsored retirement mandate. Created under HF 782 and signed into law in May 2023 by Governor Tim Walz, the Minnesota Secure Choice Retirement Program will offer more employees, especially those who have never had access to a workplace plan, a simple, portable way to save through payroll deductions. 

Minnesota Secure Choice officially launched its pilot phase in January 2026. As the program begins its first wave of enrollment, employers should note:

• Mandatory participation: Enrollment is required for all Minnesota businesses with 5+ employees that do not already offer a retirement program.

• Administrative responsibility: Employers are responsible for registering with Secure Choice, maintaining accurate employee eligibility data, and facilitating the necessary payroll deductions.

• You have alternatives: For those who do not want to use the state-sponsored program, they can pursue 401(k) options with a different provider. 

While the program adds some administrative work, it is designed to minimize burden and help workers take meaningful steps toward long-term financial security. As a Retirement Industry Disruptor™, Human Interest helps growing organizations across the country offer affordable 401(k) plans with transparent pricing, automated tools, and built-in compliance support. 

Below, we break down what employers can expect as Minnesota prepares to launch its program.

How the Minnesota Secure Choice Retirement Program works

Secure Choice operates as a state-sponsored IRA program facilitated through payroll deductions. Employers that do not offer a qualified retirement plan must enroll and set up Roth IRA accounts for all eligible Minnesota employees. Covered workers will contribute a designated percentage of their pay into the IRA, with default investment options managed by the Minnesota State Board of Investment.

Employees will be automatically enrolled, but may choose to:

• Contribute on a pre-tax or Roth basis (if allowed when the program launches)

• Opt out of participation

• Change their contribution rate or select alternative investment options from the available fund lineup

Employers will not be expected to make contributions, and participating workers will be fully vested in their accounts at all times.

Enrollment phases for Secure Choice

Minnesota Secure Choice launched in January 2026 with a soft rollout that’s available to companies of any size. A pilot program will run in early 2026 for covered businesses of all sizes, and early enrollment is available. Organizations with five or more Minnesota employees will later be contacted by the program’s recordkeeper during the enrollment phase that aligns with their size. Employers must either enroll or submit an exemption by the last day of their assigned phase. 

Employers must either enroll or submit an exemption by the last day of their assigned phase. Here’s the current enrollment schedule:

Participation requirements for employers

All Minnesota companies with five or more employees that do not offer a qualifying retirement plan will be required to participate in Secure Choice or file an exemption. Additionally, businesses will be expected to: 

• Maintain accurate employee records

• Manage payroll deductions

• Communicate the necessary program details to their employees

Similar to other state-facilitated IRAs, employers will not be fiduciaries under the program. Learn how a modern retirement solution can help your company stay aligned with Minnesota’s requirements and support your employees’ financial future. Get started today.

Core plan design features

While the program board continues to refine details, the following 2026 standards are in place:

• Automated savings: Participating team members begin with a 5% default contribution rate. This increases automatically by 1% annually until reaching an 8% cap, unless the employee chooses otherwise.

• Tax treatment: Contributions are deposited into a Roth IRA (after-tax) by default, though a pre-tax traditional IRA option may be available.

• Integration: The state provider offers several integration paths to interface with your existing payroll software to minimize manual data entry.

• No employer match: Under state IRA rules, employer contributions are prohibited. If you want to put people ahead of profit by matching employee savings, you must use a private 401(k) plan.

If employees change jobs or leave the workforce, they can choose to keep their IRA with the state or request a distribution based on available options—potentially including lump-sum or lifetime income options to be clarified by the board.

Program impact and considerations for employers 

Minnesota’s program may help many workers start saving, yet organizations looking to offer higher savings potential, employer match opportunities, and more customization may find a 401(k) to be a more flexible solution. Contribution limits for IRAs—$7,500 (in 2026) or $8,600 for those age 50 and older—are lower than the $23,500 (up to $31,500+ with catch-ups) for 401(k) plans.

While the full impact of Secure Choice will evolve, similar programs in other states have expanded retirement plan access but shown mixed results in terms of savings levels. If the Minnesota model follows patterns similar to those in states like California and Oregon, noncompliant companies may face financial penalties. While specific penalty amounts have not yet been finalized, the board is expected to provide written warnings during the first year before assessing fines.

Alternatives to Minnesota Secure Choice

For many small and midsized companies, a 401(k) provides benefits such as broader investment options, higher contribution limits, optional employer matches, and plan design features that support long-term retention. What's more, under SECURE Act 2.0, small businesses starting a 401(k) can claim tax credits that may cover up to 100% of startup costs (up to $15,000 over three years) plus a credit of up to $1,000 per employee for employer contributions.

Want to learn more about Minnesota Secure Choice alternatives? Here are a few resources to get you started:

• 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)

Why choose Human Interest

Selecting a 401(k) provider can feel overwhelming, especially for employers who are offering a savings program for the first time. Human Interest is a modern retirement platform built to make 401(k) administration simple for businesses of all sizes. Our automated tools, transparent pricing, and built-in compliance support can help Minnesota business owners meet state requirements while giving employees more ways to save for the future. 

For those who need a little extra help, Human Interest offers an award-winning, dedicated support team that streamlines retirement planning so you can focus on running your business. Get started today.

Frequently asked questions about the Minnesota Secure Choice Program

Who is required to participate in Minnesota Secure Choice? Employers with five or more Minnesota employees must enroll in Secure Choice or file an exemption if they already offer a qualified retirement plan. 

Are employers expected to contribute to Secure Choice? No. Employers are not obligated to contribute and are not considered fiduciaries under the program.

Can employees opt out of Secure Choice? Yes. Employees may opt out of the program, choose pre-tax or Roth contributions (if available), adjust their contribution rate, or select alternative investment options.

How can Human Interest help Minnesota businesses navigate Secure Choice and retirement benefits? Human Interest offers a modern 401(k) solution with transparent pricing, automated administration, and built-in compliance support. They support employers in meeting state requirements while offering employees a flexible, long-term savings option.