December 12, 2022 | Posted in:

State-Mandated Retirement Plans: Default or Customize?

Many states, including New Jersey, are passing legislation that requires businesses to offer some type of retirement savings program.

The NJ Secure Choice Savings Program

Signed into law in 2019, the New Jersey Secure Choice Savings Program will automatically enroll companies with over 25 employees in a state-protected IRA unless they opt-out. While the exact date was delayed by the pandemic and is still unknown, it’s important to begin preparations.

Don’t be limited by a state-run plan

Being enrolled in NJ’s (or any state-run) Auto-IRA has limitations:

  • Investments will be managed by the government.
  • Plans are not customized for your specific business.
  • Employers cannot match contributions.
  • Participants have limited investment options and cannot borrow from their savings.

In contrast, private plans allow for potential employer tax credits, much higher contribution limits, control and flexibility.

Benefits of a custom business retirement plan

Retirement plans are crucial to the employee benefits package. The right plan can differentiate your business and contribute positively to your culture, all while providing tax benefits and improving financial wellness.

Attracting and rewarding employees.

The biggest headache for many small businesses in 2022 has been recruiting and retaining employees. If your business offers a bare minimum 401(k) plan, it’s not doing you any favors if you are competing for new talent or rewarding loyal employees.

No “one-size-fits-all” approach.

No two small businesses are alike, so why should your retirement plans be? A financial advisor can help you identify plan goals, navigate options specific to your workforce, implement custom retirement solutions, and regularly check in on your plan’s progress.

Reduced administrative burden.

Employers in a state-run program may have more manual duties when it comes to registering and enrolling employees, managing deferrals and opt-outs, synchronizing with payroll, and more. Rely on financial and payroll professionals who will help keep you compliant with the state requirements.


Alloy Silverstein Financial Services, Inc. can guide you on the options before you become locked in a state program that doesn’t fit the needs of your business.

Securities offered through Avantax Investment ServicesSM, Member FINRA, SIPC.
Investment advisory services offered through Avantax Advisory ServicesSM.


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