CalSavers – What is it?
The CalSavers Retirement Savings Program is a new state mandated retirement plan. It is for employers who don’t offer a company retirement plan. Employers who are subject to CalSavers are those with at least five employees who are over the age of 18 and have at least one employee working in the state of California.
For more information visit www.CalSavers.com!
Is CalSavers Right For Your Company?
Many employees are not saving for retirement and look to their employer for ways to save for retirement. Provides a way for California workers to save for retirement. Automatic payroll deduction Roth IRA savings program for employees who lack access to a workplace retirement plan.
Important Considerations
▪ Employees will be automatically enrolled in a Roth IRA at 5% of salary and with an annual auto increase of 1% per year of up 8%
▪ Employers must enroll eligible employees within 30-days of employment and keep track of sign-up and opt-out forms.
▪ The employer is responsible for uploading and monitoring employee contribution amounts every pay period.
▪ CalSavers IRAs are subject to the same rules and regulations as other Roth IRAs which mean high-income employees and/or employees part of a the high-income household will need to continuously opt-out
▪ Only employees will be able to contribute, no employer contributions.
▪ Employers must take action before compliance deadlines or penalties apply.
