Nearly 129,000 Illinois workers already are saving for retirement courtesy of the Illinois Secure Choice program, and now a key deadline is approaching for small employers to help even more employees do the same. Under state law, businesses that had between 5 and 15 employees last year have until Nov. 1, 2023 to help their workers access a retirement savings option by either signing up for Illinois Secure Choice or offering a private retirement plan. How Illinois Secure Choice works: The default option for program participants is to enroll in a target-date Roth IRA with a 5 percent contribution rate. Participants can choose to change their contribution level or fund option at any time. Participants contribute a portion of their paycheck to their IRA through a payroll deduction facilitated by their employer.
Accounts are owned by individual participants and are portable from job-to-job. Investments are held in a separate trust outside the Illinois Treasury and managed by professional investment managers. The law phased in employer onboarding by employer size, starting with companies of 500 or more employees when the program launched in 2018. The deadline for the final onboarding group, Wave 5, employers with five or more employees, is Nov. 1, 2023. What employers are required to do: Offer employees’ access to Illinois Secure Choice or another retirement program. Employers that are contacted by the program must either start the process of getting Illinois Secure Choice in place or request an exemption (for instance, if they already offer a qualified retirement plan for their workers). Eligible employers can register or request an exemption at www.ilsecurechoice.com.