Employers with more than 50 employees that don’t currently offer a Retirement Savings Program must do so or register for a CalSavers Plan by June 30, 2021.
Employers with more than 5 employees that don’t currently offer a Retirement Savings Program must do so or register for a CalSavers Plan by June 30, 2022
CalSavers is California’s new retirement savings program that offers workers in California the opportunity to get on track for the future.
CalSavers is available to California workers whose employers don’t offer a workplace retirement plan, self-employed individuals, and others who want to save extra. Savers contribute to an Individual Retirement Account (IRA) that belongs to them. Employers that don’t offer their own plan will register for CalSavers by their deadline and facilitate their employees’ access to the Program.
EMPLOYERS
- Registration is quick and easy.
- Employers have limited responsibilities.
- There are no employer fees and no fiduciary responsibility.
SAVERS
- Automatic features or pick your own.
- Opt out or back in at any time.
- Simplified investing with low fees.
- Portable IRA that belongs to you.
- Employers cannot make contributions to employee accounts.
- The CalSavers account is a Roth IRA (after tax).
- The default savings rate is 5% of gross pay, and an employee can change their contribution rate at any time.
- An employee will be auto-enrolled after 30 days if they do not opt out and will begin saving through payroll deductions. That person can opt out and back in at any time.
- An employee’s account is portable. It stays with them even if they leave the company
Penalties for non-compliance per Government Code is $250.00 per eligible employee. If after six months, a company is still not in compliance, the penalty is $500.00 per eligible employee.
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