Is CalSavers Right for my Company, or are there Alternatives?

CalSavers Requirements are in Effect for 2022, but there are Alternatives

As of June 30, 2022 all California employers with 5 or more employees will be required to sponsor either a CalSavers retirement plan, or an alternative plan.

CalSavers FAQ

Failure to cover eligible employees could result in penalties of $250-500 per eligible employee!

The deadline for employers with 50 or more employees has already passed, however you do not have to continue the CalSavers program if you decide it is not right for your company.  Other plan types like a 401(k) or Profit Sharing Plan may satisfy the California Mandate.

Why would I want something other than the CalSavers Program?

In a word, flexibility.  Covering your employees under a retirement plan that falls under IRS Codes 401, 403 and 408 may earn you an exemption from having to participate in the rigid and somewhat bare bones CalSavers program.  For many small employers a 401(k) Plan may make a lot of sense because you may have more control and flexibility around who is covered in your plan, the investments that you choose, the service provider and the rules around how money goes in and out of the plan.

For many other small employers they would prefer to opt out of CalSavers simply because they do not want the State of California telling them what they have to do.  You do not have to use Calsavers but some employers believe it is their only option.

Give us a call at 619-942-4510 or email jason@missionretirementplans.com to find out what alternatives may work for you and your company.

Call us at (619) 942-4510  to learn more or set up a consultation.

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