MERIT Savings Program Comes to Maine: Help Your Clients Prepare

Calling all financial advisors! Starting June 30th, Maine is rolling out its new MERIT savings program. Why is this important? If your Maine business-owner clients have five or more employees and do not currently offer those employees a retirement plan, they’ll need to do so by the deadline or risk facing costly penalties. Time is of the essence to ensure they make a necessary and beneficial choice. We’re arming you with the information you’ll need to better serve your clients and boost your credibility.

Key Takeaways:

• Maine is implementing the MERIT savings program to give workers within the state an opportunity to save for retirement.
• Employers with five or more employees who don’t currently have a retirement plan must adopt one by June 30th or face the possibility of penalties.
• You can help your clients choose an option that meets the state’s requirements and provides flexibility and financial savings.

What is the MERIT savings program?

Maine has launched the Maine Retirement Investment Trust, (MERIT), savings program. This was done to give workers in Maine a fair chance to save for retirement. Surprisingly, 40% of private-sector workers in Maine are without access to a retirement account.

While this plan is designed to be an easy solution to the retirement plan issue, the fact that it’s a state-run program removes employer autonomy to manage the plan, make changes, and even offer matching employer contributions. Additionally, state-run IRA programs aren’t eligible for the same tax credits as 401(k) retirement plans.

Are there other beneficial options for your clients?

Here’s where ePlan Services comes in. With an ePlan Services 401(k) retirement plan, business owners can work with our support team to make changes to their plans, giving them more control without adding additional work for you. They can also implement contribution matching, a benefit that may help to increase employee satisfaction. Employees can make contributions to their account of up to $23,000, compared to the state IRA that only allows for a maximum of $7,500—less than one-third of the limit of an ePlan Services 401(k) (assuming that the employee does not qualify for up to $1,000 in additional catch-up contributions).

How can ePlan Services help you bring more value to your clients?

Are your clients aware that establishing a retirement plan may bring them tax credits? As their trusted financial professional, you can use our tax estimator to show your clients their tax savings potential. They may require some enticing to make the decision to adopt a retirement plan and few things are more attractive to clients than visual data. One look at those numbers may be just what your clients need to follow through with their responsibilities.

Conclusion:

The retirement plan requirement is coming to Maine in June. Are your clients ready for the implementation? You’re just the right person to ensure that they are. Speak with your clients today about this new legislation and show them how an ePlan Services retirement plan can be the right solution to satisfy their state’s requirements and save money.