The Illinois Secure Choice Savings Program will automatically enroll employees into a retirement savings program. Employees may opt out at any time.
Once enrolled, workers will contribute a portion of their income (default rate = 3%) into an investment fund managed by a private company and overseen by the Illinois Secure Choice Savings Board.
Workers are allowed to opt out or change their investment contributions, and the fund is entirely employee-funded.
Illinois began a pilot program in 2018 and more information on implementation will come in 2019.
How will the law impact employers?
Small business owners support the Secure Choice Savings Program. Small Business Majority’s scientific polling found the majority of Illinois small business owners supported legislation establishing the Secure Choice Savings Program.
Many small businesses would like to offer retirement plans to their employees—to help attract a talented workforce and boost employee morale—but can’t afford the overhead and administrative costs. The Secure Choice Savings Program provides a way for small businesses to offer their employees access to retirement benefits without incurring the associated burdens of employer- sponsored retirement programs.
Nearly 80% of those who work for small businesses do not have access to a retirement savings option at work; meanwhile, the small business market is not being adequately served by the financial services industry. The Secure Choice Program will help serve an underserved population that wants to save for retirement.
Small businesses with fewer than 25 employees and the self-employed may opt in and enroll in the Secure Choice Savings program. Once enrolled, they can manage the payroll deduction that best fits their financial needs.
If you have questions about the Secure Choice Savings Program, please contact Geri Aglipay, Small Business Majority’s Midwest Outreach Manager, at [email protected].
For more information on retirement for small business, visit smallbusinessportal.org/retirement.