Does Your Company Offer A Retirement Plan? It May Now

Retirement planning concept, calculator with empty notepad with pen and handwriting underline headline as Retirement Plan on wood table, plan of saving and investment for expense after retire life.

Does Your Company Offer A Retirement Plan? It May Now

Jill Kaz, CFP®, Financial Planner

October 25, 2019

Do you own a company in Illinois and do not offer a retirement plan?  Are you an employee of an Illinois company who would like to save for retirement, but do not have a convenient way to do so? Illinois has come up with a plan that may offer an option for you. The state has been phasing in a retirement savings plan, Illinois Secure Choice, for private-sector workers that attempts to address both of these questions. The goal is to provide an easy way for workers in Illinois to put money away for retirement.

What is Illinois Secure Choice?

Illinois Secure Choice is a retirement savings program for employers who do not already offer a qualified retirement plan.  It was signed into law in January 2015 and requires most businesses to provide the program. All companies that have been operating for two years or more, have 25 or more employees, and are not currently offering a qualified plan are required to participate. As of this writing, the program only has a Roth IRA option; however, a traditional IRA option may be available in the future. The plan has been introduced in stages:

  • Companies with 500 employees or more were required to register by November 1, 2018
  • Companies with 100 to 499 employees were required to register by July 31, 2019
  • Companies with 25-99 employees are required to register by November 1, 2019

What does it mean for Employers?

There is some administrative work that the employer needs to complete. Employers required to offer Illinois Secure Choice must take the following steps:

  • Register for the program at (the state will notify the employer when it is time to register).
  • Provide Illinois Secure Choice with information about each participant.
  • Automatically withhold 5% of an employee’s compensation up to the annual maximum allowed for IRA contributions each year as provided by the IRS. However, the employee can elect a different amount or opt-out of the program.
  • Remit contributions to the Illinois Secure Choice program.
    • Information can be entered either manually or through a bulk employee contribution template.
    • Funds can be remitted through ACH push or pull, wire, or check.
    • The employer must remit the contributions as soon as administratively possible, but no later than seven business days after deduction from an employee’s compensation.
  • Facilitate ongoing administration.
    • Submit contributions to the Illinois Secure Choice employer portal every pay cycle.
    • Updating contribution rates and submitting payroll contributions.
    • Set up new employees in the Illinois Secure Choice employer portal within 60 days of the hire date.
    • All records associated with Illinois Secure Choice should be kept for three years.

Employers who are required to participate will be subject to a penalty of $250 per employee the first year they fail to comply with the program and $500 per employee in each subsequent year.

Employers are not required to:

  • Make any employer contributions
  • Pay any administrative fees
  • Act as a plan manager or fiduciary
  • Fulfill any ERISA requirements

What does it mean for Employees?

  • The employee is automatically enrolled unless they opt-out.
  • When an employee is enrolled, they will receive an invitation from Illinois Secure Choice.
  • To opt-out, the employee must contact Illinois Secure Choice either by phone, mail, or online.
  • Once the employer has registered for the program, employees have 30 days to either change the 5% default amount or opt-out of the program entirely.
  • Once activated, the employee can choose to stop participating, transfer the money to another Roth IRA, request a distribution, or opt-out at any time.
  • Keep in mind that Roth IRAs are subject to income limits. For 2019, the limits are $137,000 for a single tax filer and $203,000 for a married taxpayer filing jointly. For those employees with income over the limits, they are responsible for contacting Illinois Secure Choice to opt-out of the program.
  • If no investment options are selected, funds will be allocated to the Illinois Secure Choice Target Retirement Fund. Other investment options include a Capital Preservation Fund, Conservative Fund, and Growth Fund.
  • Full-time and part-time employees are covered. The employee must be employed in Illinois.
  • The program charges an administrative fee of approximately .0075% or $0.75 per year for every $100 in an account. It is automatically deducted from the account, and the employee will not see a charge.

At Strategic Wealth Partners, we aim to help businesses and individuals with their retirement plans. Please reach out to us if you have any questions about this new requirement for business owners in Illinois. Additionally, we would be happy to help if you would like to look into other retirement plan options.


This article contains general information that is not suitable for everyone. The information contained herein should not be constructed as personalized investment advice. Past performance is no guarantee of future results. Reading or utilizing this information does not create an advisory relationship. An advisory relationship can be established only after the following two events have been completed (1) our thorough review with you of all the relevant facts pertaining to a potential engagement; and (2) the execution of a Client Advisory Agreement. There is no guarantee that the views and opinions expressed in this article will come to pass.  Investing in the stock market involves gains and losses and may not be suitable for all investors. Information presented herein is subject to change without notice and should not be considered as a solicitation to buy or sell any security.

Strategic Wealth Partners (‘SWP’) is an SEC registered investment advisor with its principal place of business in the State of Illinois. The brochure is limited to the dissemination of general information pertaining to its investment advisory services, views on the market, and investment philosophy. Any subsequent, direct communication by SWP with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides. For information pertaining to the registration status of SWP, please contact SWP or refer to the Investment Advisor Public Disclosure website (

For additional information about SWP, including fees and services, send for our disclosure brochure as set forth on Form ADV from SWP using the contact information herein. Please read the disclosure brochure carefully before you invest or send money (

Share this post:

Blog Archives