RetireReady NJ vs. ePlan Services’ 401(k): Help Your Clients Decide

Currently in New Jersey, adopting a retirement plan is optional; that will change soon. New Jersey business owners with 25 or more employees will be required to provide a retirement savings program to stay in compliance with the state’s new legislation. Business owners can choose to enroll in the state-administered savings program, RetireReady NJ, or select a potentially more advantageous option such as an ePlan Services retirement plan.

As their trusted advisor, you can save your New Jersey clients from choosing an inferior savings option. This is a prime opportunity to help them choose a retirement savings program that will satisfy the state’s requirement and allow them to pocket more money in the long run.

Key Takeaways

• A state-administered IRA may seem convenient, but it’s limited.
• An ePlan Services 401(k) retirement plan can bring your clients value in numerous ways, (detailed within this blog).
• You can help make your clients’ choices easy by allowing them to view their potential savings in real-time.

What is the reason for this new legislation?

The New Jersey government wants to give all New Jersey workers the option to save for retirement. Presently, 1.7 million workers in New Jersey do not have retirement savings. As a solution to this problem, NJ has created RetireReady NJ, a state-administered IRA savings program.

How does a state-administered savings program work?

Your client may think they’re getting a burden-free and compliant savings program by registering with New Jersey’s RetireReady NJ IRA, but it may not be as ideal as it seems. Yes, the state will administer the plan for them, but a state program comes with no flexibility to make changes, match employee contributions, or the ability for employees to contribute more than $7,000 a year.

How does an ePlan Services retirement plan work?

An ePlan Services retirement plan lets your client enjoy more autonomy with plan management than the basic state-run savings program. For starters, a 401(k) allows your clients access to a team that provides easy plan setup and troubleshooting for when issues arise. If your NJ clients start a new plan, add an auto-enrollment feature, or add an employer contribution, they can receive over $5,000 in tax credits1 . The state-run IRA can’t do the same.

How can you point your clients in the right direction?

With our tax estimator, you can quickly calculate your clients’ estimated savings potential. Saving money is a powerful motivator for business owners and, with this handy tool, you can give them an idea of how much they stand to gain. Now is your chance to demonstrate your value, what are you waiting for? You’re in a position to help your clients make the best choice for their businesses and employees.

Conclusion:

Soon, your clients are going to need to decide which retirement option they’d like to present to their employees. If not, they run the risk of not complying with state requirements. This is your chance to take the guesswork out of the process and show them why ePlan Services gives them more value and flexibility in the long term. Don’t watch your clients make a mediocre choice, instead, steer them in the right direction with an ePlan Services 401(k) plan. For more information on how you can effectively collaborate with us, reach out today.

1 SECURE Act: Eligible businesses may qualify for a federal tax credit of up to $5,000 annually for three years for administrative and certain other qualifying costs for establishing a workplace retirement plan. An additional $500 credit annually for three years is available if your plan offers auto-enrollment. The Employer Contribution credit may provide up to $1,000 per employee for matching or profit sharing contributions.