State Mandated Retirement Plans
Stay updated on your state's requirements.
Many states require employers to offer retirement benefits. Starting a Human Interest 401(k) can help you comply with legislation and avoid costly penalties.
States with active legislation
California - CalSavers Type of Plan:
Roth IRA (option available to recharacterize account as traditional IRA)
Deadlines: Final
deadline on December 31, 2025, will require employers with 1+ employees over age 18 in the
prior year that do not currently offer a qualified retirement plan to participate in the
program. (Mandates for businesses with 100+ employees, 50+ employees, and 5+ employees have
already passed.)
Fines: Employers
may be subject to a $250 fine per employee if found in noncompliance 90+ days after the
notice and an additional $500 fine per employee if found in noncompliance after 180+ days.
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Colorado - Colorado SecureSavings Type of Plan:
Roth IRA
Deadlines: All
existing deadlines have passed. Employers with 5+ employees that have been in business for
two or more years, and who do not currently offer a qualified retirement plan are currently
required to comply.
Fines: Employers
may be subject to a $100 fine per employee (up to a maximum of $5,000 per calendar year) if
found in non-compliance.
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Connecticut - MyCTSavings Type of Plan:
Roth IRA
Deadlines: All
existing deadlines have passed. Employers with 5+ employees are currently required to
comply.
Fines: Employers
that don’t comply by 90 calendar days after the final noncompliance notice could receive
between $500 and $1,500 in fines as outlined below:
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Delaware - Delaware EARNS Type of Plan:
Roth IRA
Deadlines:
Employers with 5+ employees and who do not currently offer a qualified retirement plan are
currently required to comply by October 15, 2024.
Fines: Employers
that don't comply with the law could be fined up to $250 per employee per year with a
maximum total penalty of $5,000 per year.
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Illinois - Illinois Secure Choice Type of Plan:
Roth IRA
Deadlines:
Employers with 5+ employees and who do not currently offer a qualified retirement plan are
currently required to comply.
Fines: Employers
that do not comply face penalties of $250 per employee for the first year and $500 per
employee for each subsequent year.
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Maine - Maine Retirement Investment Trust (MERIT) Type of Plan:
Roth IRA
Deadlines:
Employers with 5+ employees who have been in business 2+ years and who do not currently
offer a qualified retirement plan are currently required to comply.
Fines: Per
eligible employee:
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Maryland - Maryland$aves Type of Plan:
Roth IRA
Deadlines:
Employers with 1+ employees who have been in business 2+ years, pays employees through an
automated payroll system and who do not currently offer a qualified retirement plan are
currently required to comply.
Fines: The program
does not currently provide for penalties for non-compliance. However, participating
employers receive a waiver of the $300 required annual report filing fee.
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Massachusetts - Massachusetts CORE Plan Type of Plan:
Multiple Employer Plan (MEP)
Deadlines: No
specific deadlines as the program is voluntary.
Fines: No fines.
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Nevada - Nevada Employee Savings Trust Program Type of Plan:
Auto IRA
Deadlines: Employers with 6 or more employees are currently required to comply by September 1, 2025.
Fines: TBD
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New Jersey - RetireReady NJ Type of Plan:
Roth IRA
Deadlines: All existing deadlines have passed. Employers with 10 or more employees that do not already offer a retirement program are
required to enroll or provide an employer-sponsored retirement plan to their employees.
Fines: After a written warning in the first year, employers are subject to
these fines per employee for every year following: $100 in year 2, $250 in years 3-4, $500
in year 5+.
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New York - New York Secure Choice Savings Program Type of Plan:
Roth IRA
Deadlines: Enrollment is launching in phases based on employee count:
Fines: TBD
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Oregon - OregonSaves Type of Plan:
Roth IRA
Deadlines: All
Oregon businesses are currently required to comply.
Fines: Employers
not in compliance with the mandate must pay a fine of $100 per affected employee, up to a
maximum of $5,000 per calendar year.
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Rhode Island - Rhode Island Secure Choice Retirement Savings Program Type of Plan:
Roth IRA
Deadlines:
Enrollment is launching in phases:
Fines: Yes. Each
eligible employer that, without good cause, fails to allow its eligible employees to
participate in the program within 30 days from the date the notice of penalty was issued,
shall be subject to a penalty of $250 per eligible employee.
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Vermont - VT Saves Type of Plan:
IRA or Roth IRA
Deadlines:
Enrollment is launching in phases:
Fines: Yes. Below
are the fees per eligible employee per year:
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Virginia - RetirePath Virginia Type of Plan:
IRA or Roth IRA
Deadlines: All
existing deadlines have passed as of February 2024.
Fines: Up to $200
per eligible employee per year.
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Washington - Washington Saves Type of Plan:
Marketplace - multiple options, Roth IRA coming in 2027
Deadlines: No
deadlines for existing marketplace. Washington Saves to replace Washington's Small Business
Retirement Marketplace by July 1, 2027. Deadlines for new program unknown as this time.
Fines: For
existing marketplace, no fines. For Washington Saves (coming 2027), yes. If the department
finds an employer administrative violation, the department must first provide an educational
letter outlining the violations and provide 90 days for the employer to remedy the
violations. Then, a first-time willful violation is $100 and $250 for a second willful
violation. For each subsequent willful violation, the employer is subject to a maximum
penalty amount of $500 for each violation.
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States with passed legislation
Hawaii - Hawaii Retirement Savings Program Type of Plan:
Roth IRA
Deadlines:
Currently unknown. The program has yet to be implemented.
Fines: Yes.
Noncompliant employers will receive a penalty of no less than $500 for each violation or
failure; provided that the penalties shall not exceed $5,000 per calendar year.
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Minnesota - Minnesota Secure Choice Retirement Program Type of Plan:
IRA or Roth IRA
Deadlines: The
Minnesota Secure Choice retirement program will begin operation in the 1st quarter of 2026.
Fines: Written
warnings provided for the first year of noncompliance. Then, other unspecified penalties may
be assessed.
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Missouri - MyRetirement Savings Type of Plan:
Open multiple-employer plan (MEP)
Deadlines:
Expected to be operational on or before September 1, 2025.
Fines: TBD
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New Mexico - New Mexico Work & Save and New Mexico Marketplace Type of Plan:
Roth IRA & Marketplace
Deadlines: The
program is currently on an indefinite hold.
Fines: Penalties
for the New Mexico Work & Save Roth IRA program have not been determined yet. Because the
New Mexico Marketplace will be voluntary, there will not be any penalties associated with
enrollment or lack thereof.
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Retirement Legislation
State mandate legislation is sweeping the country
More than 20 states have proposed state-mandated retirement plan legislation, and 17 states have active mandated plans.
What are state mandated retirement plans?
What are state mandated retirement plans?
State mandate overview
These programs require employers to provide access to retirement savings options. Employers may enroll their employees in a state-sponsored retirement program—or choose an employer-sponsored plan, such as a Human Interest 401(k) plan. Our 401(k) plans provide a flexible alternative to state-mandated options, ensuring your employees have robust retirement savings opportunities tailored to their needs.
How it works
Most state-mandated retirement programs provide Roth IRAs, with automatic enrollment for employees, which have key differences compared to 401(k) plans. Employees automatically contribute a percentage of wages via payroll deductions unless they opt out or choose their own election. Exemptions may apply to small businesses, new companies, or those already offering qualified retirement plans.
Potential fees & penalties
Employers may face significant penalties for non-compliance. Fines may be charged per eligible employee for failing to offer a retirement plan or properly enroll employees in a qualifying plan. State-sponsored programs may also carry fees that impact employers and employees. Management and recordkeeping fees typically range from 0.5% to 1% of the account balance, while investment fees can vary between 0.1% and 1% annually.
Traits of a typical state program
Limited plan structure
State plans often use Roth IRAs and auto-enroll employees at 3-5% of wages, with opt-out options.
Lower contribution limits
IRA: $7,500/year (under 50), $8,600 (over 50). 401(k): 24,500/year (under 50), $32,500/year (50-59 or 64+), $35,740 (60-63).
Employer roles and fees
Employers aren't required to contribute. Participant fees range from 0.5% to 1% annually.
Portability and management
Accounts are portable, and professional firms manage investment options and compliance.
Limited investment options
State plans offer a limited range of investment options, typically including target-date funds, balanced funds, and conservative choices like money market or stable value funds.
Penalties for non-compliance
Employers who fail to comply with state mandates may face annual fines per eligible employee.
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